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Equilibrium existence in Krugman’s and Bertoletti–Etro’s trade models: the general case

Economic Theory. 2025.
Slepov F., Kokovin S. G.

We revisit Krugman’s (J Int Econ 9(4):469–479, 1979.) classical trade model in its general form with several asymmetric countries and unspecified additive utility functions. We present the weakest known conditions on utilities sufficient for the existence of equilibrium. These conditions are also necessary under symmetric preferences. Using the same method for Bertoletti and Etro’s (Econ J 127(603):1217–1243, 2017.) trade model with several asymmetric countries, we establish sufficient conditions on unspecified indirect utilities for the existence of equilibrium.

Language: English
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Keywords: international tradevariable markupsmonopolistic competitionvariable elasticity of substitutionExistence of equilibriumIndirect profits
Publication based on the results of:
Economic and mathematical analysis of markets, games, and decision-making (2025)
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