Price stickiness and markup variations in market games

Guo Chen, C. Gizem Korpeoglu, Stephen E. Spear

Onderzoeksoutput: Bijdrage aan tijdschriftTijdschriftartikelAcademicpeer review

2 Citaten (Scopus)

Samenvatting

In this paper, we show that the Shapley–Shubik market game model with production naturally generates an equilibration mechanism that can accommodate price stickiness arising from strategic interactions of firms. Unlike New Keynesian models that show similar price stickiness results, the market game model does not require enforcing menu costs or other additional restraints on price adjustment mechanisms in order to generate price stickiness. As such, we suggest that the market game model can provide a good micro-foundation for macroeconomic analysis. We then explicitly show the relationship between a typical firm's markup of price over marginal cost and its market share.

Originele taal-2Engels
Pagina's (van-tot)95-103
Aantal pagina's9
TijdschriftJournal of Mathematical Economics
Volume72
DOI's
StatusGepubliceerd - okt 2017
Extern gepubliceerdJa

Vingerafdruk

Duik in de onderzoeksthema's van 'Price stickiness and markup variations in market games'. Samen vormen ze een unieke vingerafdruk.

Citeer dit