Comparative Advantage under Oligopoly
AbstractWe analyze the principle of comparative advantage when agents in the world market are aware of the influence their individual supply exerts on the equilibrium exchange rate of goods. We show that specialization following comparative disadvantage can be an oligopoly equilibrium in a Ricardian economy. Moreover, for a wide class of economies, it is the only one. Nonetheless, when the number of agents in each country increases without limit, the equilibrium in which specialization follows comparative advant.age again obtains.
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Bibliographic InfoPaper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 1993007.
Date of creation: 01 Feb 1993
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Comparative Advant.age; Oligopoly;
Other versions of this item:
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
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