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Domestic Input Policies in Free Trade Areas with National Asymmetries

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Author Info
Yann Duval () (Asian Institute of Technology, School of Management)

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Abstract

This paper combines some of the most realistic components of the competitive and strategic trade literature to examine both socially and individually optimal domestic input policies in free trade areas (FTAs). When asymmetries in the number of firms, in the number of consumers, or in production costs exist across countries, tax harmonization is not optimal and input taxes depend on the shape of the production process and the degree of imperfect competition. The presence of input tax asymmetries in a customs union or FTA does not constitute evidence of strategic behavior at the national level.

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File URL: http://college.holycross.edu/eej/Volume28/V28N2P241_253.pdf
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Publisher Info
Article provided by Eastern Economic Association in its journal Eastern Economic Journal.

Volume (Year): 28 (2002)
Issue (Month): 2 (Spring)
Pages: 241-253
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Handle: RePEc:eej:eeconj:v:28:y:2002:i:2:p:241-253

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Related research
Keywords: Free Trade; Strategic Trade; Trade;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

References listed on IDEAS
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  1. Brander, James A. & Spencer, Barbara J., 1985. "Export subsidies and international market share rivalry," Journal of International Economics, Elsevier, vol. 18(1-2), pages 83-100, February. [Downloadable!] (restricted)
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  2. Novshek, William, 1985. "On the Existence of Cournot Equilibrium," Review of Economic Studies, Blackwell Publishing, vol. 52(1), pages 85-98, January. [Downloadable!] (restricted)
    Other versions:
  3. Keen, Michael & Lahiri, Sajal, 1993. "Domestic tax reform and international oligopoly," Journal of Public Economics, Elsevier, vol. 51(1), pages 55-74, May. [Downloadable!] (restricted)
  4. Martin Richardson, 1994. "Customs Unions and Domestic Taxes," Canadian Journal of Economics, Canadian Economics Association, vol. 27(3), pages 537-50, August. [Downloadable!] (restricted)
  5. Lahiri, Sajal & Raimondos-Moller, Pascalis, 1998. "Public good provision and the welfare effects of indirect tax harmonisation," Journal of Public Economics, Elsevier, vol. 67(2), pages 253-267, February. [Downloadable!] (restricted)
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  6. Yann Duval & Stephen Hamilton, 2002. "Strategic Environmental Policy and International Trade in Asymmetric Oligopoly Markets," International Tax and Public Finance, Springer, vol. 9(3), pages 259-271, May. [Downloadable!] (restricted)
  7. Eaton, Jonathan & Grossman, Gene M, 1986. "Optimal Trade and Industrial Policy under Oligopoly," The Quarterly Journal of Economics, MIT Press, vol. 101(2), pages 383-406, May. [Downloadable!] (restricted)
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  8. Dixit, Avinash, 1984. "International Trade Policy for Oligopolistic Industries," Economic Journal, Royal Economic Society, vol. 94(376a), pages 1-16, Supplemen.
  9. Bresnahan, Timothy F, 1981. "Duopoly Models with Consistent Conjectures," American Economic Review, American Economic Association, vol. 71(5), pages 934-45, December. [Downloadable!] (restricted)
  10. Gerber, James, 2000. "National Policies and the Limits of International Integration," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 1(01). [Downloadable!]
  11. Conrad Klaus, 1993. "Taxes and Subsidies for Pollution-Intensive Industries as Trade Policy," Journal of Environmental Economics and Management, Elsevier, vol. 25(2), pages 121-135, September. [Downloadable!] (restricted)
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