IDEAS home Printed from https://ideas.repec.org/a/eee/reveco/v92y2024icp114-122.html
   My bibliography  Save this article

Optimal local content requirement under export share requirement consideration

Author

Listed:
  • Hung, Chih-Ming
  • Weng, Yungho

Abstract

This paper considers a Cournot model with a local content requirement and export share requirement. The analysis investigates the conditions under which the local content requirement may promote an intermediate industry and explores the optimal local content requirement and the key factors that affect it. The results show that while a small local content requirement has a promotion effect when it is first introduced, while if the local content requirement is further increased, the effect will depend on the intermediate industry's production efficiency. Furthermore, the optimal local content requirement should be higher as the domestic market expands or the export price increases. Finally, the export share requirement can be treated as a policy instrument that is supplementary to the local content requirement.

Suggested Citation

  • Hung, Chih-Ming & Weng, Yungho, 2024. "Optimal local content requirement under export share requirement consideration," International Review of Economics & Finance, Elsevier, vol. 92(C), pages 114-122.
    • Handle: RePEc:eee:reveco:v:92:y:2024:i:c:p:114-122
    DOI: 10.1016/j.iref.2024.02.027
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1059056024001011
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.iref.2024.02.027?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Export share requirement; Foreign direct investment; Local content requirement;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:reveco:v:92:y:2024:i:c:p:114-122. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620165 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.