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Author: Federico Etro Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
I characterize the optimal export promoting policy for international markets whose structure is endogenous. Contrary to the ambiguous results of strategic trade policy for duopolies, it is always optimal to subsidize exports when entry is endogenous, under both quantity and price competition. With homogenous goods the optimal export subsidy is a fraction of the price, where is the elasticity of demand (the exact opposite of the optimal export tax in the neoclassical trade theory). Analogously, I show the general optimality of R&D subsidies and of competitive devaluations to promote exports in foreign markets where entry is endogenous.
Author: Federico Etro Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
I characterize the optimal export promoting policy for international markets whose structure is endogenous. Contrary to the ambiguous results of strategic trade policy for duopolies, it is always optimal to subsidize exports when entry is endogenous, under both quantity and price competition. With homogenous goods the optimal export subsidy is a fraction of the price, where is the elasticity of demand (the exact opposite of the optimal export tax in the neoclassical trade theory). Analogously, I show the general optimality of R&D subsidies and of competitive devaluations to promote exports in foreign markets where entry is endogenous.
Author: Federico Etro Publisher: Springer Science & Business Media ISBN: 3540874275 Category : Business & Economics Languages : en Pages : 363
Book Description
This is a key year for the evolution of international markets. The global economy is experiencing the most severe downturn since the thirties, it is temporarily leaving a path of sustained growth that characterized the last decades, and is facing an impressive decline of trade between countries. Banks are going bankrupt, the stock market has crashed, rms are going out of bu- ness or drastically reducing their production and exports, workers are being red and investment in new business creation or innovation is shrinking. Meanwhile, consumers con dence has dropped at its minimum, aggregate demand has been declining for months and expansionary policies and int- national coordination have failed to counteract the crisis until now. It is quite likely that all this will change sooner or later, but at the end of this crisis our understanding of the macroeconomy may change as well. In front of these crucial events, this book is not an attempt at proposing a radically new way of interpreting macroeconomic phenomena, and, as a m- ter of fact, it is not even a book on macroeconomic theory. My more modest goal is to collect a number of insights derived from recent research on the role of competition and innovation in the analysis of three topics: business cycles, trade and growth through innovations.
Author: Orlando I. Balboa Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
We explore the interplay of market structure and government trade policy in the context of a heterogenous goods duopoly model (allowing for goods to be substitutes or complements) wherein governments simultaneously and noncooperatively choose whether or not to provide subsidies for their firms and then firms noncooperatively choose output levels, either sequentially (i.e., in a Stackelberg leader-follower model) or simultaneously (i.e., in a Cournot-Nash model). We focus on competition in quantities but also provide results when firms compete in prices. In both the quantity and price models we further allow for endogenous market structure by considering two game forms wherein one of the firms, a potential leader, can choose to lead or not lead (play Cournot). We find that government trade policy and market structure can interact. First, the trade regime can alter traditional firm preferences over sequential versus simultaneous play. Second, different market structures can influence governments' preferences about free trade versus subsidies. Further, if one of the firms is a potential leader, allowing for endogenous market structure generates equilibrium outcomes that sometime reinforce, and sometimes counter, received results in the extant strategic trade literature. For example, when firms compete in quantities, endogenous market structure results in Cournot-Nash competition, but competition in prices results in a leader-follower structure.
Author: Ignatius J. Horstmann Publisher: ISBN: Category : Commercial policy Languages : en Pages : 48
Book Description
Almost all of the large literature on international trade with imperfect competition assumes exogenous market structures. The purpose of this paper is to develop a simple model that generates alternative market structures as Nash equilibria for different parameterizations of the basic model. Familiar configurations such as a duopoly competing in exports or a single multinational producing in both markets arise as special cases. Small tax-policy changes can produce large welfare effects as the equilibrium market structure shifts, implying discontinuous jumps in prices, quantities, and profits.
Author: Federico Etro Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
Most market structures are neither perfectly or monopolistically competitive: they are characterized by a few large firms that are engaged in strategic interactions in their production and investment decisions and whose number is endogenous. The theory of endogenous market structures analyzes markets in partial and general equilibrium where strategies affect entry and entry affects strategies, and exogenous primitive conditions on technology and preferences affect the equilibrium. We discuss applications to industrial organization, international trade, business cycle theory, international finance, growth and implications for welfare and for competition, trade, fiscal and monetary policy.
Author: Haokai Ning Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
We introduce demand uncertainty into the context of strategic trade policy in an export rivalry market model, and we examine endogenous timing in the framework of Cournot-Stackelberg duopoly when firms decide in the first stage whether to set output level before or after resolution of uncertainty. In the absence of government intervention, both Cournot outcome and Stackelberg outcome could emerge in the equilibrium depending on market volatility and cost difference between firms. Under bilateral export subsidies, both firms tend to prefer making output decisions after the resolution of uncertainty which yields only the Cournot market structure. This result holds for any degrees of uncertainty, regardless whether the firm has cost advantage over its rival or not.
Author: Colin Carter Publisher: CRC Press ISBN: 0429714483 Category : Science Languages : en Pages : 282
Book Description
This book presents International Agricultural Trade Research Consortium commissioned papers. The papers systematically explore the conceptual and empirical dimensions of the new trade theory and try to determine the potential application to agricultural trade and trade policy analysis.
Author: G.M. Grossman Publisher: Elsevier ISBN: 9780444815477 Category : Business & Economics Languages : en Pages : 902
Book Description
This reference accords recognition to the recent revolution in macroeconomics wrought by imperfect competition. Grossman and Rogoff (Princeton U.) present chapters by two dozen contributors on two prime areas of research interest: international trade theory and policy (e.g. strategic trade patterns and policies, the relationship between trade and technological progress), and open economy macroeconomics and international finance (covering such topics as exchange rates, foreign lending, and policy coordination). The volume commences with Krugman's overview of the positive theory of international trade, and concludes with analyses of sovereign debt. Annotation copyrighted by Book News, Inc., Portland, OR.
Author: Federico Etro
Author: Federico Etro
Author: Federico Etro
Author: Federico Etro
Author: Orlando I. Balboa
Author: Ignatius J. Horstmann
Author: Federico Etro
Author: Haokai Ning
Author: Colin Carter
Author: G.M. Grossman
Author: Gene M. Grossman