Publication type: Working paper – expertise – study
Title: Distributional comparative statics with heterogeneous agents
Authors: Hefti, Andreas
DOI: 10.2139/ssrn.2874899
Extent: 55
Issue Date: 2016
Series: Working Paper Series
Series volume: 237
Publisher / Ed. Institution: University of Zurich
Publisher / Ed. Institution: Zurich
ISSN: 1664-7041
1664-705X
Language: English
Subjects: Heterogeneity; Inequality; Monopolistic competition; General equilibrium
Subject (DDC): 330: Economics
Abstract: We propose a formal way to systematically study the differential effects of exogenous shocks in economic models with heterogeneous agents. Our setting applies to models that can be rephrased as "competition for market shares" in a broad sense. We show that even in presence of any number of arbitrarily heterogeneous agents, a single recursion relation characterizes the distributional pattern of equilibrium market shares and related measures. We identify the general conditions under which the market share function rotates, thereby either causing more or less equality among the agents. Our setting highlights the exceptional rule that power functions play for the distributional effects. We apply our method across economic models, including examples from monopolistic competition, discrete choice, partial and general equilibrium theory and contest theory.
URI: https://digitalcollection.zhaw.ch/handle/11475/15978
License (according to publishing contract): Licence according to publishing contract
Departement: School of Management and Law
Organisational Unit: Center for Energy and Environment (CEE)
Appears in collections:Publikationen School of Management and Law

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