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Optimal trade policy in the presence of changing market structure

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  • Mark Herander
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    Abstract

    This study examines the optimal use of tariff policy in response to a change in both the number and market behavior of domestic firms. The paper demonstrates that under certain demand conditions, optimal trade policy may require an increase in tariffs in response to an increase in consolidation or collusion among domestic firms. Copyright Kluwer Academic Publishers 1993

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    File URL: http://hdl.handle.net/10.1007/BF01000043
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    Bibliographic Info

    Article provided by Springer in its journal Open Economies Review.

    Volume (Year): 4 (1993)
    Issue (Month): 3 (September)
    Pages: 235-245

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    Handle: RePEc:kap:openec:v:4:y:1993:i:3:p:235-245

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    Web page: http://www.springerlink.com/link.asp?id=100323

    Related research

    Keywords: optimal tariff; collusion; market consolidation; imperfect competition;

    References

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    1. Barbara J. Spencer & James A. Brander, 1982. "Tariff Protection and Imperfect Competition," Working Papers 517, Queen's University, Department of Economics.
    2. Simon Cowan, 1989. "Trade and Competition Policies for Oligopolies," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 125(3), pages 464-483, September.
    3. Horstmann, Ignatius J. & Markusen, James R., 1986. "Up the average cost curve: Inefficient entry and the new protectionism," Journal of International Economics, Elsevier, vol. 20(3-4), pages 225-247, May.
    4. Cheng, Leonard K, 1988. "Assisting Domestic Industries under International Oligopoly: The Relevance of the Nature of Competition to Optimal Policies," American Economic Review, American Economic Association, vol. 78(4), pages 746-58, September.
    5. James A. Brander & Barbara J. Spencer, 1983. "Trade Warfare: Tariffs and Cartels," NBER Working Papers 1193, National Bureau of Economic Research, Inc.
    6. Dixit, Avinash, 1984. "International Trade Policy for Oligopolistic Industries," Economic Journal, Royal Economic Society, vol. 94(376a), pages 1-16, Supplemen.
    7. Dixit, Avinash, 1988. "Anti-dumping and countervailing duties under oligopoly," European Economic Review, Elsevier, vol. 32(1), pages 55-68, January.
    8. Jones, Ronald W., 1987. "Trade taxes and subsidies with imperfect competition," Economics Letters, Elsevier, vol. 23(4), pages 375-379.
    9. 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.
    10. Buffie, Edward F. & Spiller, Pablo T., 1986. "Trade liberalization in oligopolistic industries : The quota case," Journal of International Economics, Elsevier, vol. 20(1-2), pages 65-81, February.
    11. Seade, Jesus K, 1980. "On the Effects of Entry," Econometrica, Econometric Society, vol. 48(2), pages 479-89, March.
    12. Venables, Anthony J., 1985. "Trade and trade policy with imperfect competition: The case of identical products and free entry," Journal of International Economics, Elsevier, vol. 19(1-2), pages 1-19, August.
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