@article{Blanchard:292672,
      recid = {292672},
      author = {Blanchard, Olivier J. and Kiyotaki, Nobuhiro},
      title = {Monopolistic Competition, Aggregate Demand Externalities  and Real Effects Of Nominal Money},
      address = {1985-11},
      number = {2242-2019-3171},
      series = {8515},
      pages = {38},
      year = {1985},
      abstract = {A long standing issue in macroeconomics is that of the  relation of imperfect competition to fluctuations in  output. In this paper we examine the relation between  monopolistic competition and the role of aggregate demand  in the determination of output. We first show that  monopolistically competitive economies exhibit an aggregate  demand externality. We then show that, because of this  externality, small menu costs, that is small costs of  changing prices may lead to large effects of aggregate  demand on output and on welfare.},
      url = {http://ageconsearch.umn.edu/record/292672},
      doi = {https://doi.org/10.22004/ag.econ.292672},
}