Imperfectly competitive markets, trade unions and inflation: do imperfectly competitive markets transmit more inflation than perfectly competitive ones? A theoretical appraisal Articles uri icon

publication date

  • July 2018

start page

  • 189

end page

  • 201

volume

  • 5

International Standard Serial Number (ISSN)

  • 2164-6066

Electronic International Standard Serial Number (EISSN)

  • 2164-6074

abstract

  • In this paper we study the theoretical plausibility of the conjecture that inflation arises because imperfectly competitive markets (ICM in the sequel) translate cost pushes in large price increases. We define two different measures of inflation transmission. We compared these measures in several models of ICM and in perfectly competitive markets (PCM in the sequel). In each case we find a necessary and sufficient condition for an ICM to transmit more inflation -according to the two measures- than that transmitted by a PCM.

keywords

  • Inflation; imperfect competition