"Product-Market Integration and Endogenous Asymmetries of Technology Adoption"

We explore the impact of product-market integration on asymmetric choices of technology adoption of ex ante identical entrepreneurs. Our model seeks to embed micro foundations of firm heterogeneity into an open-economy model. Relative to the existing literature the model (i) offers further characterisations of asymmetric equilibria in Cournot models with technology adoption and free entry, and (ii) adopts a general-equilibrium approach to carefully account for the determinants of market size shifts. The model naturally reproduces oligopolistic market structures that are expected to prevail after an increase in market size, despite the absence of entry barriers. The analysis also shows how the idiosyncratic characteristics of preferences of different countries shape the impact of product-market integration on the number of high performing firms as well as on market concentration. Along the way, we discuss the implications of an integer-constrained free-entry number of firms.


Université de Bourgogne
Wednesday, May 3, 2017 - 13:00
Sala de Consejo, Beauchef 851, floor 4 - Departamento de Ingeniería Industrial, Universidad de Chile