Abstract. In this paper, we use a unique micro-level data set from Istanbul to investigate the empirical relationship between inflation and price dispersion. In particular, our data set includes price observations from three distinct store types: bakkals (convenience stores), pazars (bazaars), and supermarkets. Our findings indicate that pazars exhibit the least amount of price dispersion on average, which is consistent with the fact that menu and search costs are very low in the pazar and that such sellers seem to have very little market power. Moreover, we find that several of the basic inflation-dispersion channels identified by the theoretical literature seem to be operating in our data.

We consider static non-cooperative games with a continuum of small players whose payoffs depend on their own actions and finitely many summary statistics of the aggregate strategy profile. We prove the existence of an equilibrium in pure strategies without any convexity restrictions on payoffs or the common action space. We show that this result applies to a broad class of monopolistic competition models. Copyright Springer-Verlag Berlin Heidelberg 2003Keywords and Phrases: Large games, Summary statistics, Monopolistic competition., JEL Classification Numbers: C72, D43.,

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In this article, we show that a standard economic model, the endogenous learning-by-doing model, captures several major themes from the anxiety literature in psychology. In our model, anxiety is a fully endogenous construct that can be separated naturally into its cognitive and physiological components. As such, our results are directly comparable with hypotheses and evidence from psychology. We show that anxiety can serve a motivating function, which suggests potential applications in the principal-agent literature.