MONOPOLISTIC COMPETITION MODEL WITH ENTRANCE FEE

We study the monopolistic competition model with producer-retailer-consumers two-level interaction. The industry is organized according to Dixit–Stiglitz model. retailer only monopolist. A quadratic utility function represents consumer preferences. consider case of retailer's leadership; namely, we two types behavior: and without free entry condition. Earlier, obtained result: increase social welfare and/or surplus, government needs subsidize (not tax!) retailers. In presented paper, develop these results for situation when producer imposes an entrance fee