(picture source: Pixabay)

Lately, Professor Wang Yongjin has had a paper accepted in Economics Letters (SSCI), coauthored by Lijun Pan. The paper is titled "Competition Among Large and Heterogeneous Small Firms".

Their paper extends the model of Parenti (2018) on large and small firms by introducing cost heterogeneity among small firms. We propose a novel necessary and sufficient condition for the existence of such a mixed market structure. Furthermore, in contrast to Parenti (2018), we show that in the presence of cost heterogeneity among small firms, trade liberalization may raise or reduce the mass of small firms in operation.