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Voluntary import expansions with non-stationary demand

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Author Info
Xiaopeng Yin

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Abstract

In this paper the effect of voluntary imports expansions (VIEs) on welfare in a dynamic game is analysed. It is found that (1) there exists a Markov perfect Nash equilibrium (MPNE) and a unique stable steady state; (2) with habit formation in consumption, the welfare and output for each firm are higher than that without habit formation; and (3) VIEs can increase an importing country's welfare with raised consumption and lowered price. Therefore, VIEs can be voluntary to an importing country.

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Publisher Info
Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 37 (2004)
Issue (Month): 4 (November)
Pages: 1084-1096
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Handle: RePEc:cje:issued:v:37:y:2004:i:4:p:1084-1096

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies

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This page was last updated on 2008-7-23.


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