Abstract: The global fashion market continues to expand, yet fast fashion items are often discarded prematurely, generating substantial textile waste. Despite the industry’s large environmental footprint, few economic models address the structure of fashion and apparel markets. This paper develops a simple model of a differentiated durable-goods market, extending the CES monopolistic competition framework of Dixit and Stiglitz (1977). Durable goods last multiple periods but degrade over time. Firms introduce new varieties each period, and with free entry the number of varieties is determined endogenously. With an infinitely lived consumers, we analyze the roles of secondary markets. With representative consumers, the option to resell acts as a demand subsidy, lowering new-goods prices, increasing total durable-goods production, reducing product variety, and lowering consumer welfare. With heterogeneous consumers who differ in preferences for new versus second-hand goods, we find that a larger share of second-hand–goods lovers can raise resale prices, lower new-goods prices, reduce product variety, and increase total production. However, with two product types – high-quality durable goods and low-quality perishable goods, we show that a higher share of second-hand–goods lovers raises the resale price of high-quality goods, encouraging new-goods lovers’ demand for high-quality goods. This crowds out low-quality perishable goods and reduces total industry output, and encourages high-quality goods producers to lower price and increase durability, which add additional benefits. Overall, as production shifts toward high-quality durable goods, environmental harm is reduced.

要旨：We present a macro-finance model with innovation and knowledge spillover. Skilled agents engage in R&D activities (establish firms) or work in the knowledge-intensive sector. Unskilled agents work in the traditional sector. Knowledge spillover from innovations to the two sectors is initially high and uneven (unbalanced growth), but eventually weakens and equalizes (balanced growth). A rational stock bubble (prices exceed fundamentals) necessarily emerges, even though it is expected to burst with regime switching. Despite the inevitable collapse, stock bubbles and technological innovation reinforce each other and lead to permanently higher output and wages because technologies developed during the bubble era prevail.

Panel Discussion: WOMEN IN STEM – INSIGHTS FROM WITHIN AND BEYOND JAPAN