We consider a Ramsey model with a continuum of Cournotian industries where free entry generates an endogenous markup. The model produces two different regimes, monopolistic and Cournotian monopolistic competition, resulting in non-smooth dynamics. We analyze the global dynamics of the model,...

In this note we show that the claim from Chen et al (2005) that their model generates an endogenous markup is incorrect. This is not only a nomenclature issue: using the �fixed markup which we show to be the only one consistent with the structure of the model implies the main conclusions in...

We compute average mark-ups as a measure of market power throughout time and study their interaction with fiscal policy and macroeconomic variables in a VAR framework. From impulse-response functions the results, with annual data for a set of 14 OECD countries covering the period 1970-2007, show...

We compute average markups as a measure of market power throughout time and study their interaction with fiscal policy and macroeconomic variables in a VAR framework. From impulse-response functions, the results, with annual data for a set of 14 OECD countries, show that the markup (i) depicts a...

This paper analyses a simple imperfectly competitive general equilibrium model where the entry mechanism generates an endogenous markup. In this second-best world fiscal policy is more effective than in Walrasian or in fixed-markup monopolistic competition models, as it produces efficiency gains...