Studying the standard monopolistic competition model with unspecified utility/cost functions, we find necessary and sufficient conditions on the function elasticities, when an expanding market or trade incur welfare losses. Two numerical examples explain why: either excessive or insufficient...

We study a multidimensional screening problem with minimal restrictions on valuations. Our ?-relaxation of the constraints excludes bunching and cycles in the graph of active incentive-compatibility constraints. Therefore, the Lagrange multipliers do exist and enable us in characterizing...

We develop a two-factor, two-sector trade model of monopolistic competition with variable elasticity of substitution. Firms' profits and sizes may increase or decrease with market integration depending on the degree of asymmetry between countries. The country in which capital is relatively...