<div class="csl-bib-body">
<div class="csl-entry">Ziegler, G. (2014). <i>Monopolistic competition, idiosyncratic productivity and information constraints</i> [Master Thesis, Technische Universität Wien]. reposiTUm. https://doi.org/10.34726/hss.2014.24935</div>
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dc.identifier.uri
https://doi.org/10.34726/hss.2014.24935
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dc.identifier.uri
http://hdl.handle.net/20.500.12708/4277
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dc.description.abstract
A firm might not have perfect information about its own productivity, because observing the true realization might be too costly in terms of op- portunity costs of attending to other sources of uncertainty. Building on Sims (1998, 2003), I use insights from information theory to study the be- havior of information constrained firms. The focus is on the informational friction on the firm side only. This allows analyzing the implications of imperfect information for individual firms. Additionally, a welfare analysis is conducted by solving a social planner's problem. Interestingly, a com- parison using approximations in log-deviations is not applicable, although such an approximation is often used in the literature. In the decentralized economy, output might not be maximized under full information. Further- more, the distortions due to monopolistic competition are increasing in the amount of information agents are allowed to process.
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dc.language
English
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dc.language.iso
en
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dc.rights.uri
http://rightsstatements.org/vocab/InC/1.0/
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dc.subject
Imperfect information
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dc.subject
idiosyncratic productivity
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dc.subject
rational inattention
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dc.subject
information theory
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dc.subject
aggregation
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dc.subject
welfare comparison
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dc.title
Monopolistic competition, idiosyncratic productivity and information constraints