money and capital abstract the effects of money anticipated inflation on capital formation is a classic issue in macroeconomics previous papers adopt reduced form approaches putting money in the utility function or imposing cash in advance but using otherwise frictionless models we follow instead a literature that tries to be explicit about the frictions making money essential this introduces new elements including a two sector structure with centralized and decentralized markets stochastic trading opportunities and bargaining these elements matter quantitatively and numerical results differ from findings in the reduced form literature the analysis also reduces a gap between microfounded monetary economics and mainstream macro

agents with principles the control of labor in the dutch east india company 1700 to 1796 principal agent problems plagued early modern corporations the existing literature emphasizes the potential benefits provided by private trade in aligning the interests of company agents to those

the canadian border and the us dollar the impact of exchange rate changes on us retailers this paper provides a micro level investigation into the impact of changes in the uscanada nominal exchange rate on retailers in us regions lying close to the uscanada border using a large data set on product level retail prices and sales in the united states over a nine year period we explore the links between changes in exchange rates cross border travel and the price and quantity responses of us retailers this allows us to assess the importance of geography and distance in affecting the pass through of exchange rate changes into prices and quantities at the level of the consumer we develop a two stage theoretical model of cross border travel and industry equilibrium for retail sales at the border our empirical results accord well with the implications of the model

group lending repayment incentives and social collateral abstract in this paper we investigate the impact on repayment rates of lending to groups which are made jointly liable for repayment this type of scheme especially in the guise of the grameen bank in bangladesh has received increasing attention we set up and analyze the repayment game which group lending gives rise to our analysis suggests that such schemes have both positive and negative effects on repayment rates the positive effect is that successful group members may have an incentive to repay the loans of group members whose projects have yielded insufficient return to make repayment worthwhile the negative effect arises when the whole group defaults even when some members would have repaid under individual lending we also show how group lending may harness social collateral which serves to mitigate its negative effect

rotating and accumulating savings and credit associations a development perspective abstract financial self help groups in low income countries consist of two basic types rotating and accumulating savings and credit associations or roscas and ascras in the ascra funds are not immediately withdrawn but are left to grow for loan making comparing the two groups the author finds similarities and differences efforts to rectify the rosca s shortcomings have prompted many innovations and given birth to a hybrid preserving the best of both types in constant adaptation to changing environments

price gaps at the border evidence from multi country household scanner data abstract studies employing micro price data to examine the extent of international goods market integration tend to find that borders imply arbitrage impeding transaction costs inducing market segmentation within monetary unions these effects are found to be very minor though at least when online prices are considered however analyzing household scanner price data from three euro area member states belgium germany and the netherlands we document that households face and pay significantly different prices for identical goods across these countries in the vast majority around 75 of cases considered for regions within countries as a counterfactual however no evidence for such effects exists employing cross border shopping information we are able to draw direct conclusions about the question of integration of markets for a substantial number of goods in addition we can also derive a measure of border costs for most of them for goods for which no cross border shopping take place we provide a lower bound for border costs in the majority of cases in line with existing evidence our findings suggest considerable heterogeneities in border costs median values generally range between 15 and 20 of the price of a good for exact border cost estimates and between 18 and 20 for the derived lower bounds considering the distribution of values obtained suggests that most values lie in a range of 40 since our data set comprises purchase information from all major retailers present in a given market we are also able to examine the role of retailer heterogeneity for cross border price gap estimates differences in retailer composition turn out to be fairly small however grouping goods by various characteristics reveals that goods purchased more often tend to exhibit somewhat bigger border estimates considering the price or the goods category however does not yield any conclusive insights

monopolistic competition in the spirit of chamberlin a general model this paper develops a model of large group chamberlinian monopolistic competition in which 1 there are many firms producing differentiated commodities 2 each firm is negligible in that it can ignore its impact on and hence reactions from other firms 3 free entry leads to zero profit of operating firms but 4 each firm faces a downward sloping demand curve the existence of a monopolistically competitive equilibrium is established in a companion paper more particular questions such as whether the market provides too many or too few products are addressed for a special case of the model

tastes and technology in a two country model of the business cycle explaining international trade on international financial markets allows people to insure country specific risk and smooth consumption intertemporally equilibrium models of business cycles with trade on global financial markets typically yield international consumption correlations near one and excessive volatility of investment the authors incorporate nontraded goods in the model and find that the implications for aggregate consumption investment and the trade balance are consistent with business cycle properties of industrialized countries however the model driven by technology shocks alone yields counterfactual implications for comovements between consumption and prices at the sectoral level taste shocks produce price quantity relationships more consistent with the data copyright 1995 by american economic association

the extensive margin and monetary policy abstract the creation of new firms referred to as the extensive margin is a significant but overlooked dimension of monetary policy a monetary var documents that monetary policy has significant effects on firm creation an analytically tractable model combining sticky prices and firm entry shows that entry alters the transmission of monetary policy innovations acting much like a type of investment in more standard models monetary policy rules that offset the uncertainty of productivity shocks can raise the mean level of entry and thereby welfare suggesting a new motivation for stabilization policy

gift exchange versus monetary exchange theory and evidence abstract we study the lagos and wright 2005 model of monetary exchange in the laboratory with a finite population of sufficiently patient agents this model has a unique monetary equilibrium and a continuum of non monetary gift exchange equilibria some of which pareto dominate the monetary equilibrium we find that subjects avoid the gift exchange equilibria in favor of the monetary equilibrium we also study versions of the model without money where all equilibria involve non monetary gift exchange we find that welfare is higher in the model with money than without money suggesting that money plays a role as an efficiency enhancing coordination device jel c92 d12 e40 z13

the minimum wage restaurant prices and labor market structure using store level and aggregated consumer price index data we show that restaurant prices rise in response to minimum wage increases under several sources of identifying variation we introduce a general model of employment determination that implies minimum wage hikes cause prices to rise in competitive labor markets but potentially fall in monopsonistic environments furthermore the model implies employment and prices are always negatively related therefore our empirical results provide evidence against the importance of monopsony power for understanding small observed employment responses to minimum wage changes our estimated price responses challenge other explanations of the small employment response too

establishing local government in fragile states experimental evidence from afghanistan international and domestic policy makers often promote elections to establish village government in fragile states however two additional options are available in such countries formalization of self governing village councils and formalization of community development councils cdcs we designed a survey experiment in afghanistan that compares the consequences of elections to establish village councils to each alternative we find that elections and to a lesser extent formalization of cdcs improve support for democracy while formalization of customary councils improves support for reconciliation with the taliban moreover the consequences of transplanting elections are contingent on social norms and institutions supportive of democracy

entry in monopoly market this paper develops new empirical models of market concentration from game theoretic models of entry we construct our models from inequality conditions that describe entrants equilibrium strategies in simultaneous move and sequential move games and use them to study the effects of entry in isolated monopoly markets for new automobiles from estimates of the market size necessary to support one and two dealers we conclude that monopoly dealers do not block the entry of a second dealer we also find that entry does not cause price cost margins to fall by much

sticky price models of the business cycle can the contract multiplier solve the persistence problem we construct a quantitative equilibrium model with firms setting prices in a staggered fashion and use it to ask whether monetary shocks can generate business cycle fluctuations these fluctuations include persistent movements in output along with the other defining features of business cycles like volatile investment and smooth consumption we assume that prices are exogenously sticky for a short time persistent output fluctuations require endogenous price stickiness in the sense that firms choose not to change prices much when they can do so we find that for a wide range of parameter values the amount of endogenous stickiness is small thus we find that in a standard quantitative model staggered price setting alone does not generate business cycle fluctuations

international prices costs and markup differences relative cross border retail prices in a common currency comove closely with the nominal exchange rate using product level prices and wholesale costs from a grocery chain operating in the united states and canada we decompose this variation into relative costs and markup components the high correlation of nominal and real exchange rates is driven mainly by changes in relative costs national borders segment markets retail prices respond to changes in costs in neighboring stores within the same country but not across the border prices have a median discontinuous change of 24 percent at the border and 0 percent at state boundaries jel f31 l11 l81

demand and distance evidence on cross border shopping while many studies have documented deviations from the law of one price in international settings evidence is scarce on the extent to which consumers take advantage of price differentials and engage in cross border shopping we use data from 287 swedish municipalities to estimate how responsive alcohol sales are to foreign prices and relate the sensitivity to the location s distance to the border typical results suggest that the elasticity with respect to the foreign price is around 0 4 in the border region moving 200 400 kilometers inland reduces it to 0 2 0 1 given that cross country price differences for alcohol and other products are often caused by taxes our evidence has implications for the debate on tax competition harmonization

new directions for stochastic open economy models the paper develops a simple stochastic new open economy macroeconomic model based on sticky nominal wages explicit solution of the wage setting problem under uncertainty allows one to analyze the effects of the monetary regime on welfare expected output and the expected terms of trade despite the potential interplay between imperfections due to sticky wages and monopoly the optimal monetary policy rule has a closed form solution to motivate our model we show that observed correlations between terms of trade and exchange rates are more consistent with our traditional assumptions about nominal rigidities than with a popular alternative based on local currency pricing 2000 elsevier science b v all rights reserved

capacity use in multi unit firms evidence for efficiency gains or strategic competition in the us restaurant industry in this article i examine both the full firm size distribution and establishment level capacity use to determine if efficiency gains or strategic competition account for the proliferation of multi unit firms in the us restaurant industry using us census microdata i find that multi unit firms operate a greater number of restaurants and larger individual restaurants in larger metropolitan statistical areas msas this evidence of increased profitability goes hand in hand with increases in capacity utilization through longer operating hours and more intensive production of meals and nonmeals output at individual establishments greater capacity exploitation is consistent with efficient firms rather strategic behaviour such as product proliferation or location preemption to limit rivalry furthermore these results hold true for multi unit firms but not for large national chain systems suggesting that efficiency gains accrue from firm specific capital not just from marketing or distribution scale econ

the economics of collective reputation evidence from the wine industry we use original data regarding the array of italian winery coalitions wine denominations to analyze the economics and determinants of collective reputation we first run a cross sectional analysis with 2008 data and the full set of control variables then move to the dynamics of collective reputation with panel data analysis on a 30 year time span 1978 2008 group reputation is history dependent in particular past bad collective behavior increases the probability of being stuck in a bad reputation trap minimum quality standards and effective enforcement are fundamental drivers of group reputation the relationship between group size and collective reputation is non linear free entry may not be optimal due to free riding problems finally institutional signals such as the wine classification system are useful because they can be used by consumers as easily available proxies for information that is much more difficult to acquire

money in search equilibrium in competitive equilibrium and in competitive search equilibrium we compare three market structures for monetary economies bargaining search equilibrium price taking competitive equilibrium and price posting competitive search equilibrium we also extend work on the microfoundations of money by allowing a general matching technology and entry we study how equilibrium and the effects of policy depend on market structure under bargaining trade and entry are both inefficient and inflation implies first order welfare losses under price taking the friedman rule solves the first inefficiency but not the second and inflation may actually improve welfare under posting the friedman rule yields the first best and inflation implies second order welfare losses

a fundamental theory of exchange rates and direct currency trades in this paper we construct a two country search model to determine the nominal exchange rate between two fiat monies our model allows agents to use any currency to trade for goods in all countries however search frictions restrict agents opportunities for instantaneous arbitrage and hence make the nominal exchange rate determinate the nominal exchange rate depends on the two countries economic fundamentals including the stocks and growth rates of the two monies direct exchanges between currencies are essential and they imply a nominal exchange rate that is different from the relative price between the two currencies in the goods markets there are persistent violations of the law of one price and purchasing power parity in equilibrium despite the fact that prices are perfectly flexible and all goods are tradeable between countries nominal and real exchange rates can move together in the steady state in response to money growth shocks

imports я us retail chains as platforms for developing country imports wal mart toys r us and other large retail chains are often identified with cheap imports we use data from the census of retail trade and the international trade commission over the period 1997 2002 to test whether big chains serve as platforms for imports from ldcs using difference in difference specifications we show that chinese and other ldc imports have increased disproportionately in retail sectors with the sharpest consolidation into chains to quantify the importance of chain growth to import growth we apply a numerical algorithm that generates marginal propensities to import by firm size the largest retail firms propensity to import from china is 17 percentage points higher than that of smaller retailers the corresponding difference in import propensities from ldcs as a whole is 27 points the disproportionate growth of large retailers between 1997 and 2002 explains 5 of the overall growth in consumer goods imports 20 of the growth in consumer goods imports from china and 22 of the growth in consumer goods imports from ldcs

dynamics of the trade balance and the terms of trade the j curve the authors provide a theoretical interpretation of two features of international data the countercyclical movements in net exports and the tendency for the trade balance to be negatively correlated with current and future movements in terms of trade but positively correlated with past movements they document the same properties in a two country stochastic growth model in which trade fluctuations reflect in large part the dynamics of capital formation the authors find that their general equilibrium perspective is essential the relation between the trade balance and the terms of trade depends critically on the source of fluctuations copyright 1994 by american economic association

money capital and exchange rate fluctuations we explore how the informational frictions underlying monetary exchange aect international exchange rate dynamics our perfectly exible price model is capable of producing endogenously rigid international relative prices in response to technology and monetary shocks the model is capable of accounting for the empirical regularities that the real and nominal exchange rates are more volatile than u s output and that the two are positively and perfectly correlated the model is also consistent with other standard real business cycle facts for the u s jel classication e31 e32 e43 e44

estimation of a model of entry in the airline industry this paper considers the effect of an airline s scale of operation at an airport on the profitability of routes flown out of that airport the empirical methodology uses the entry decisions of airlines as indicators of underlying profitability the results extend the empirical literature on airport presence by providing a new set of estimates of the determinants of city pair profitability these estimates imply that city pair profits increase in airport presence and decrease rapidly in the number of entering firms the literature on empirical models of oligopoly entry is also extended via a focus on the role of differences between firms

consumption and real exchange rates in dynamic economies with non traded goods abstract we examine the possibility that non traded goods may account for several striking features of international macroeconomic data large persistent deviations from purchasing power parity small correlations of aggregate consumption fluctuations across countries and substantial international real interest rate differentials a dynamic exchange economy is used to show that non traded goods in principle can account for each of these phenomena in the theory there is a close relation between fluctuations in consumption ratios and those in bilateral real exchange rates but we find little evidence for this relation in time series data for eight oecd countries

historical property rights sociality and the emergence of impersonal exchange in long distance trade this laboratory experiment explores the extent to which impersonal exchange emerges from personal exchange with opportunities for long distance trade we design a three commodity production and exchange economy in which agents in three geographically separated villages must develop multilateral exchange networks to import a good only available abroad for treatments we induce two distinct institutional histories to investigate how past experience with prop erty rights affects the evolution of specialization and exchange we find that a history of unenforced property rights hinders our subjects ability to develop the requisite personal social arrangements to support specialization and effec tively exploit impersonal long distance trade jel c90 d23 d5 p 4

competition in large markets this paper develops a simple and robust implication of free entry followed by competition without substantial strategic interactions increasing the number of consumers leaves the distributions of producers prices and other choices unchanged in many models featuring non trivial strategic considerations producers prices fall as their numbers increase hence examining the relationship between market size and producers actions provides a nonparametric tool for empirically discriminating between these distinct approaches to competition to illustrate its application i examine observations of restaurants seating capacities exit decisions and prices from 224 u s cities given factor prices and demographic variables increasing a city s size increases restaurants capacities decreases their exit rate and decreases their prices these results suggest that strategic considerations lie at the heart of restaurant pricing and turnover

contestable markets an uprising in the theory of industry structure presents a transcript of the presidential address delivered at the 94th meeting of the american economic association on december 29 1981 discussion of developments in the theory of industry structure welfare attributes of contestable markets behavior characteristics of oligopoly equilibrium intertemporal vulnerability to inefficient entry ebsco

the cleansing effect of recessions the authors investigate industry response to cyclical variations in demand production units that embody the newest process and product innovations are continuously being created and outdated units are being destroyed although outdated units are the most likely to turn unprofitable and be scrapped in a recession they can be insulated from the fall in demand by a reduction in creation the structure of adjustment costs plays a determinant role in the responsiveness of those two margins the calibrated model matches the relative volatilities of the observed manufacturing job creation and destruction series and their asymmetries over the cycle copyright 1994 by american economic association

consumer search price dispersion and international relative price fluctuations this article develops a model of consumer search consistent with the evidence of substantial price dispersion and time spent shopping within countries to study international deviations from the law of one price lop and relative price fluctuations search frictions lead firms to price discriminate across markets based on the opportunity cost of search which depends on the local wage with productivity and taste shocks estimated from the data deviations from the lop are as volatile and persistent as in the data fluctuations in relative wages real exchange rates and the terms of trade are also consistent with the data

staggering and synchronization in price setting evidence from multiproduct firms theoretical work on price setting behavior focuses on the single product case while in reality a single price setter sells many products the authors use retail store level multiproduct pricing data to learn about price dynamics they find that while the timing of a product s price changes is staggered across stores selling the same product the timing of the price changes of different products sold within the same store is highly synchronized this finding validates the usual assumption that decisions are staggered across price setters and suggests that price rigidity is due mostly to mechanical reasons and not to informational asymmetries copyright 1996 by american economic association

coordination commitment and enforcement the case of the merchant guild we interpret historical evidence in light of a repeated game model to conclude that merchant guilds emerged during the late medieval period to allow rulers of trade centers to commit to the security of alien merchants the merchant guild developed the theoretically required attributes secured merchants property rights and evolved in response to crises to extend the range of its effectiveness contributing to the expansion of trade during the late medieval period we elaborate on the relations between our theory and the monopoly theory of merchant guilds and contrast it with repeated game theories that provide no role for formal organization

entry industry growth and the microdynamics of industry supply entry is widely discussed but rarely subjected to empirical study this study develops a competitive theory of entry with primary focus on the relationship between entry and industry growth the main ingredients are adjustment costs to firms already in the industry and the distribution of fixed entry cost to potential entrants the theory suggests sufficient conditions under which the entry rate is an increasing convex function of the industry growth rate a regression model correcting for severe heteroscedasticity is applied to data from swedish manufacturing industries the results are consistent with the theoretical prediction for growth and other key variables expected to influence entry significantly

international trade and institutional change medieval venice s response to globalization international trade can have profound effects on domestic institutions we examine this proposition in the context of medieval venice circa 800 1600 early on the growth of long distance trade enriched a broad group of merchants who used their newfound economic muscle to push for constraints on the executive that is for the end of a de facto hereditary doge in 1032 and the establishment of a parliament in 1172 the merchants also pushed for remarkably modern innovations in contracting institutions that facilitated longdistance trade for example the colleganza however starting in 1297 a small group of particularly wealthy merchants blocked political and economic competition they made parliamentary participation hereditary and erected barriers to participation in the most lucrative aspects of long distance trade over the next two centuries this led to a fundamental societal shift away from political openness economic competition and social mobility and toward political closure extreme inequality and social stratification we document this oligarchization using a unique database on the names of 8 178 parliamentarians and their families use of the colleganza in the periods immediately before and after 1297 we then link these families to 6 959 marriages during 1400 1599 to document the use of marriage alliances to monopolize the galley trade monopolization led to the rise of extreme inequality with those who were powerful before 1297 emerging as the undisputed winners jel codes d02 f10 n43

history lessons the birth of impersonal exchange the community responsibility system and impartial justice this occasional feature will discuss episodes and events drawn from economichistory that have lessons for current topics in policy and research responses to thiscolumn and suggestions for future ones should be sent to kenneth sokoloff c ojournal of economic perspectives department of economics university of cali fornia los angeles 405 hilgard ave los angeles california 90095 1477

a unified framework for monetary theory and policy analysis search theoretic models of monetary exchange are based on explicit descriptions of the frictions that make money essential however tractable versions of these models typically make strong assumptions that render them ill suited for monetary policy analysis we propose a new framework based on explicit micro foundations within which macro policy can be studied the framework is analytically tractable and easily quantifiable we calibrate the model to standard observations and use it to measure the cost of inflation we find that going from 10 percent to 0 percent inflation is worth between 3 and 5 percent of consumption much higher than previous estimates

how far for a buck tax differences and the location of retail gasoline activity in southeast chicagoland abstract we exploit variation in gasoline and cigarettes taxes in adjacent political jurisdictions for northern illinois and indiana to examine consumers trade off between prices and travel we develop a model that relates activity in the retail gasoline industry around the tax borders to consumer locations our results indicate that the willingness of a typical chicagoland consumer to travel an additional mile to buy gasoline corresponds to about 0 065 to 0 084 per gallon according to our estimates the observed area of chicago the jurisdiction with the highest taxes is missing approximately 40 of the capacity that would exist were taxes equalized

real exchange rate fluctuations and the dynamics of retail trade industries on the u s canada border consumers living near the u s canada border can shift their expenditures between the two countries so real exchange rate fluctuations can act as demand shocks to border areas retail trade industries using annual county level data we estimate the effects of real exchange rates on the number of establishments and their average payroll in border counties for four retail industries in three of the four industries we consider the number of operating establishments responds either contemporaneously or with a lag of one year to real exchange rate movements for these industries the response of retailers average size is less pronounced the rapid response of net entry is inconsistent with any model of persistent deviations from purchasing power parity that depends on retailers costs of changing nominal prices

the rigidity of prices this paper uses evidence on individual transaction prices to analyze price behavior the evidence shows that for many transactions pricesremain rigid for periods exceeding one year the rigidity of price ispositively correlated with industry concentration for several productsthe correlation of price changes across buyers is low the paper alsoinvestigates the relationship between price rigidity price change andthe length of time a buyer and seller have been doing business together the author interprets the evidence as emphasizing the importance of nonprice rationing and the inadequacy of models in whichprice movements alone clear markets copyright 1986 by american economic association

from extreme to mainstream the erosion of social norms social norms usually persistent can change quickly when new public information arrives such as a surprising election outcome people may become more inclined to express views or take actions previously perceived as stigmatized and may judge others less negatively for doing so we examine this possibility using two experiments we first show via revealed preference experiments that donald trump s rise in popularity and eventual victory increased individuals willingness to publicly express xenophobic views we then show that individuals are sanctioned less negatively if they publicly expressed a xenophobic view in an environment where that view is more popular

from local to global competition abstract we introduce a framework that has known models of oligopolistic competition with differentiated products the circle the logit and the ces as limit cases this integrative approach incorporates both localized and global competition as well as price sensitive individual demands it is used to explain the impact of major changes over the last two centuries reductions in transport costs increased taste for variety population growth and use of technologies with greater returns to scale we work out the properties of an extended chamberlinian model with applications both in industrial organization and economic geography

search money and capital a neoclassical dichotomy recent work has reduced the gap between search based monetary theory and mainstream macroeconomics by incorporating into the search model some centralized markets as well as some decentralized markets where money is essential this paper takes a further step toward this integration by introducing labor capital and neoclassical firms the resulting framework nests a search theoretic monetary model and a standard neoclassical growth model as special cases perhaps surprisingly it also exhibits a dichotomy one can determine the equilibrium path for the value of money independent of the paths of consumption investment and employment in the centralized market

accounting for u s real exchange rate changes this study measures the proportion of u s real exchange rate movements that can be accounted for by movements in the relative prices of nontraded goods the decomposition is done at all possible h

money search and business cycles monetary models that specify explicit frictions to generate money demand have been developed over the last 20 years and have been used to address many questions in this article i investigate the short run properties of a particular model considering a number of versions based on some modeling choices all versions feature flexible prices i find that in many aspects both real and nominal the model resembles other more reduced form models some variations of the model come closer to matching some key nominal facts than a reduced form model the model also generates counter cyclical markups in line with the data

the economics of cross border travel abstract we model the decision to travel across an international border as a trade off between benefits derived from buying a range of products at lower prices and the costs of travel we estimate the model using microdata on canada united states travel price differences motivate cross border travel a 10 home appreciation raises the propensity to cross by 8 to 26 the larger elasticity arises when the home currency is strong a result predicted by the model distance to the border strongly inhibits crossings with an implied cost of 87 cents per mile geographic differences can partially explain why american travel is less exchange rate responsive

exchange rate dynamics and international effects of monetary shocks in monetary equilibrium models abstract this paper analyzes the ability of open economy extensions of lucas s 1990 liquidity model to explain features of observed nominal and real exchange rate dynamics and responses of key variables to monetary shocks the two country models that we consider are inhabited by multi member households who face cash in advance constraints on goods purchases and shocks to each country s technology and money growth rate countries are linked by trades in goods and currencies qualitative and quantitative implications of the model economies for exchange rate dynamics and behaviors of other key variables are examined

family structure institutions and growth the origins and implications of western corporations siders the importance of the family as an institution little attention however has been given to the impact of the family structure and its dynamics on institutions this limits our ability to understand distinct institutional developments and hence growth in the past and present this paper supports this argument by highlighting the importance of the european family structure in one of the most fundamental institutional changes in history and reflects on its growth related implications what constituted this change was the emergence of the economic and political corporations in late medieval europe corporations are defined as consistent with their historical meaning intentionally created voluntary interest based and self governed permanent associations guilds fraternities universities communes and city states are some of the corporations that have historically dominated europe businesses and professional associations business corporations universities consumer groups counties republics and democracies are examples of corporations in modern societies the provision of corporation based institutions to mitigate problems of cooperation and conflict constituted a break from the ways in which institutions had been provided in the past historically large kinship groups such as clans lineages and tribes often secured the

true monopolistic competition as a result of imperfect information the paper restates hart s 1985a 1985b definition of large group monopolistic competition distinguishes it from oligopolistic competition and raises the question of whether there are reasonable circumstances that give rise to true monopolistic competition as defined the purpose is to show that consumers imperfect information may create conditions that will turn an otherwise oligopolistic market into a truly monopolistically competitive one