Assisting Domestic Industries Under International Oligopoly : The Relevance of the Nature of Competition to Optimal Policies

Kwok Hon Leonard CHENG

Assisting Domestic Industries Under International Oligopoly : The Relevance of the Nature of Competition to Optimal Policies

Research output: Journal Publications › Journal Article (refereed) › peer-review

Abstract

Optimal trade and industrial policies are derived for a home market that is supplied by a domestic firm and a foreign firm. The optimal policy combination can be quite sensitive to the nature of the duopoly's competition. For example, for some cost and demand structures, the optimal policy under Cournot competition consists of a domestic production tax and a tariff, but that under Bertrand competition consists of a production subsidy and free trade.

Original language	English
Pages (from-to)	746-758
Number of pages	13
Journal	American Economic Review
Volume	78
Issue number	4
Publication status	Published - Sep 1988
Externally published	Yes

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https://www.jstor.org/stable/1811172

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title = "Assisting Domestic Industries Under International Oligopoly : The Relevance of the Nature of Competition to Optimal Policies",

abstract = "Optimal trade and industrial policies are derived for a home market that is supplied by a domestic firm and a foreign firm. The optimal policy combination can be quite sensitive to the nature of the duopoly's competition. For example, for some cost and demand structures, the optimal policy under Cournot competition consists of a domestic production tax and a tariff, but that under Bertrand competition consists of a production subsidy and free trade.",

author = "CHENG, {Kwok Hon Leonard}",

year = "1988",

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language = "English",

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journal = "American Economic Review",

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AB - Optimal trade and industrial policies are derived for a home market that is supplied by a domestic firm and a foreign firm. The optimal policy combination can be quite sensitive to the nature of the duopoly's competition. For example, for some cost and demand structures, the optimal policy under Cournot competition consists of a domestic production tax and a tariff, but that under Bertrand competition consists of a production subsidy and free trade.

M3 - Journal Article (refereed)

VL - 78

SP - 746

EP - 758

JO - American Economic Review

JF - American Economic Review

SN - 0002-8282

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