Strategic Trade Policy under Uncertainty
AbstractThis paper extends the Brander-Spencer (1985) model by considering market uncertainty, exploring nonlinear policy, and examining firms' choices of strategic variables. By investigating the interrelationship between trade policy and market conduct, we find that unlike the often-studied linear policy, a nonlinear policy can influence the domestic firm's choice of strategic variables and hece alter the market conduct in favor of the domestic country. Therefore, a nonlinear policy proves strictly superior to a linear one. Copyright 1995 by Blackwell Publishing Ltd.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Review of International Economics.
Volume (Year): 3 (1995)
Issue (Month): 1 (February)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0965-7576
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- Mustafa Caglayan & Murat Usman, 2003.
"Incompletely Informed Policymakers and Trade Policy in Oligopolistic Industries,"
2003_06, University of Liverpool Management School.
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- Mihir A. Desai & James R. Hines Jr., 2004.
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- Yoshino, Hisao, 2011. "Strategic trade policy and non-linear subsidy : in the case of price competition," IDE Discussion Papers 287, Institute of Developing Economies, Japan External Trade Organization(JETRO).
- Glass, Amy Jocelyn & Saggi, Kamal, 1999. "FDI policies under shared factor markets," Journal of International Economics, Elsevier, vol. 49(2), pages 309-332, December.
- Aditya Bhattacharjea, 2002. "Infant Industry Protection Revisited," International Economic Journal, Korean International Economic Association, vol. 16(3), pages 115-133.
- Keisuke Hattori & Keisaku Higashida, 2011. "When Government Misleads US: Sending Misinformation as Protectionist Devices," Discussion Paper Series 75, School of Economics, Kwansei Gakuin University, revised Aug 2011.
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