We study the competitive and reallocation effects of trade opening in monopolistic competition. To this purpose, we generalize the Melitz (2003) setup with heterogeneous firms and fixed and variable trade costs beyond the CES to the case of additively separable utility functions. We find that...

The Exclusion Principle [Baye, M.R., Kovenock, D., de Vries, C.G., 1993. Rigging the lobbying process: an application of the all-pay auction. American Economic Review 83, 289-294] asserts that, in an all-pay auction with fully informed participants, it might be profitable for the seller to...

We reconsider the recent work by Okuguchi (J Econ 101:125–131, <CitationRef CitationID="CR4">2010</CitationRef>) on (possibly asymmetric) Cournotian firms with two production factors, one being inferior for each firm. It is shown there that an increase in the price of the inferior factor does raise the equilibrium industry output. In...</citationref>

An input is inferior if and only if an increase in its price raises all marginal productivities. A sufficient condition for input inferiority under quasi-concavity of the production function is then that there are increasing marginal returns with respect to the other input and a non-positive...

We derive the relationships between the net and gross elasticities of substitution and complementarity (i.e., the elasticities that refer either to the conditional or unconditional, direct or inverse demand system) in the general case of non-homothetic, variable-returns-to-scale technologies. We...

We consider some recent criticisms of price cap methods of regulation, and suggest that many theoretical arguments, based on the so-called Bayesian approach, do not in fact point to practicable alternatives. We then investigate the use of simple and verifiable quantity regulatory methods, i.e....