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A simple business-cycle model with shumpeterian features

Costa, Luis F. and Dixon, Huw ORCID: https://orcid.org/0000-0002-9875-8965 2007. A simple business-cycle model with shumpeterian features. [Working Paper]. Cardiff Economics Working Papers, Cardiff: Cardiff University.

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Abstract

We develop a dynamic general equilibrium model of imperfect competition where a sunk cost of creating a new product regulates the type of entry that dominates in the economy: new products or more competition in existing industries. Considering the process of product innovation is irreversible, introduces hysteresis in the business cycle. Expansionary shocks may lead the economy to a new ‘prosperity plateau,’ but contractionary shocks only affect the market power of mature industries.

Item Type: Monograph (Working Paper)
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: H Social Sciences > HB Economic Theory
Publisher: Cardiff University
Date of First Compliant Deposit: 30 March 2016
Last Modified: 28 Oct 2022 10:18
URI: https://orca.cardiff.ac.uk/id/eprint/77775

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