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• W3106773842 abstract "We propose and characterize parametric families of homothetic demand systems, which feature a constant pass-through rate that is common across otherwise heterogenous monopolistically competitive firms. These parametric families offer natural, flexible, and yet tractable extensions of CES. In the case of complete pass-through, the markup rate is constant, as in CES, yet it can be heterogenous across firms, unlike in CES. In the case of incomplete pass-thorough, the price of each firm is log-linear in its marginal cost and its choke price with the common coefficients across firms. Tougher competition, captured by a lower average price, reduces the prices of all firms at a uniform rate, and hence without affecting their relative prices. Yet, it causes a disproportionately larger decline in the revenue and the profit among firms with lower markup rates." @default.
• W3106773842 created "2020-12-07" @default.
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• W3106773842 creator A5063373113 @default.
• W3106773842 date "2020-01-01" @default.
• W3106773842 modified "2023-09-27" @default.
• W3106773842 title "Constant Pass-Through" @default.
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