Economic Fluctuations and Non-Neutrality of Money Based upon Imperfect Competition

In his early paper, Ng (1980) showed that the introduction of imperfect competition along in a standard macroeconomic model with profit maximization, no time lags, no transaction costs and/or friction could break the classical dichotomy between the real and the monetary sectors and make money possibly non-neutral. However, most of the literature in macroeconomics unfortunately misses this possibility of non-neutrality of money under imperfect competition and believes that

Imperfect competition by itself does not create monetary non-neutrality … It is the combination of imperfect competition with some other distortion which generates the potential for real effect. (Dixon and Rankin, 1994, p. 178)