Imperfect Competition and the Keynesian Cross
NBER Working Paper No. 2386 (Also Reprint No. r1118)
This paper presents a simple general equilibrium model in which the only non-Walrasian feature is imperfect competition in the goods market. The model is shown to exhibit various Keynesian characteristics. In particular, as competition in the goods market becomes less perfect, the fiscal policy multipliers approach the values implied by the textbook Keynesian cross.
Published: Economics Letters, Vol. 26, no. 1 (1988): 7-13.