EconStor >
Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI), Essen >
Ruhr Economic Papers, RWI >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/29954
  

Full metadata record

DC FieldValueLanguage
dc.contributor.authorSchweinberger, Albert G.en_US
dc.contributor.authorSuedekum, Jensen_US
dc.date.accessioned2009-04-20en_US
dc.date.accessioned2010-02-12T15:30:44Z-
dc.date.available2010-02-12T15:30:44Z-
dc.date.issued2009en_US
dc.identifier.isbn978-3-86788-112-8en_US
dc.identifier.urihttp://hdl.handle.net/10419/29954-
dc.description.abstractWe develop a two-sector general equilibrium model with monopolistic competition featuring nonhomothetic production and a variable demand elasticity for the manufactured goods. An increase in the relative price of manufacturing varieties can lead to a decline in total industrial output in our framework, i.e., to de-industrialisation. The two key mechanisms behind this surprising result are that the founding of firms requires skilled labour as a fixed input requirement, and that the price increase can raise the profit margin in the manufacturing industry and thereby induce firm entry. When the manufacturing sector mainly adjusts at the extensive margin, we refer to this industry as being entrepreneurial. Due to the fixed input requirement entry reduces the effective endowment of skilled labour available for production. This reduces industrial output owing to a novel generalized version of the Rybczynski effect. De-industrialisation occurs if that effect is sufficiently large in comparison with the standard output price effect for a given number of firms. Furthermore we prove the counterintuitive result that de-industrialisation implies a fall in the output per firm and under plausible conditions a rise in welfare. Our results shed new light on the current debates about possible causes of premature de-industrialisation and its welfare effects.en_US
dc.language.isoengen_US
dc.publisherRWI Essenen_US
dc.relation.ispartofseriesRuhr economic papers 101en_US
dc.subject.jelF12en_US
dc.subject.jelD43en_US
dc.subject.ddc330en_US
dc.subject.keywordEntrepreneurial industriesen_US
dc.subject.keywordmonopolistic competitionen_US
dc.subject.keywordde-industrialisationen_US
dc.subject.keywordwelfare effectsen_US
dc.subject.stwIndustrieller Strukturwandelen_US
dc.subject.stwUnternehmensgründungen_US
dc.subject.stwMonopolistischer Wettbewerben_US
dc.subject.stwDeindustrialisierungen_US
dc.subject.stwTheorieen_US
dc.titleDe-industrialisation, entrepreneurial industries and welfareen_US
dc.typeWorking Paperen_US
dc.identifier.ppn59783752Xen_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
Appears in Collections:Ruhr Economic Papers, RWI
Publikationen von Forscherinnen und Forschern des RWI

Files in This Item:
File Description SizeFormat
59783752X.PDF164.95 kBAdobe PDF
No. of Downloads: Counter Stats
Show simple item record
Download bibliographical data as: BibTeX

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.