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Tariffs, Entry Regulation and Markups: Country Size Matters

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  • Hoekman Bernard

    ()
    (The World Bank and CEPR)

  • Kee Hiau Looi

    ()
    (The World Bank)

  • Olarreaga Marcelo

    ()
    (The World Bank and CEPR)

Abstract

Actual and potential competition is a powerful source of discipline on the pricing behavior of firms. This paper extends the empirical literature on the pro-competitive impact of policy reforms by investigating the effects on price markups of barriers to both domestic and foreign entry in a sample of developed and developing countries. While both are found to be important determinants of industry markups, we find that country size affects the impact of tariffs and domestic entry regulation. Country size dampens the impact of the former and strengthens the effect of the latter.

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Bibliographic Info

Article provided by De Gruyter in its journal The B.E. Journal of Macroeconomics.

Volume (Year): 4 (2004)
Issue (Month): 1 (September)
Pages: 1-24

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Handle: RePEc:bpj:bejmac:v:contributions.4:y:2004:i:1:n:8

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Cited by:
  1. Dobrinsky, Rumen & Korosi, Gabor & Markov, Nikolay & Halpern, Laszlo, 2006. "Price markups and returns to scale in imperfect markets: Bulgaria and Hungary," Journal of Comparative Economics, Elsevier, vol. 34(1), pages 92-110, March.
  2. Bekkers, Eddy & Francois, Joseph, 2013. "Trade and industrial structure with large firms and heterogeneity," European Economic Review, Elsevier, vol. 60(C), pages 69-90.
  3. Kotsios, Panayotis, 2010. "Regulatory Barriers to Entry in Industrial Sectors," MPRA Paper 27976, University Library of Munich, Germany.
  4. Daniel Ortega & Francisco RodrĂ­guez, 2005. "Trade Policy and Factor Prices: An Empirical Strategy," Wesleyan Economics Working Papers 2005-004, Wesleyan University, Department of Economics.
  5. Ma, Tay-Cheng, 2010. "Competition authority independence, antitrust effectiveness, and institutions," International Review of Law and Economics, Elsevier, vol. 30(3), pages 226-235, September.
  6. Harald Badinger, 2008. "Cross-country evidence on the productivity effects of trade: the role of competition and country size," Applied Economics Letters, Taylor & Francis Journals, vol. 15(9), pages 671-675.

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