Trade liberalization in a differentiated duopoly reconsidered
AbstractConstructing a model of differentiated Cournot duopoly, we consider welfare effects of trade liberalization (i.e. reductions in transport costs). We examine both multilateral trade (i.e. the firms in both countries export bilaterally) and unilateral trade, under which foreign entry is possible but the home firm cannot export. Some new results on trade gains under differentiated oligopoly are proved and their implications are discussed.
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Bibliographic InfoArticle provided by Elsevier in its journal Research in Economics.
Volume (Year): 63 (2009)
Issue (Month): 3 (September)
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Web page: http://www.elsevier.com/locate/inca/622941
Gains from trade Oligopoly Product differentiation;
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