Product Differentiation and the Gains from Trade under Bertrand Duopoly
AbstractIn the literature on the welfare effects of free trade under imperfect competition, one important case seems to have been overlooked and that is the Bertrand duopoly model with differentiated products. Although many authors have analysed the welfare effects of free trade under Cournot duopoly, and demonstrated the possibility of losses from trade, there has been no thorough analysis of the welfare effects of free trade under Bertrand duopoly. This paper presents a thorough analysis of the welfare effects of free trade under Bertrand duopoly with differentiated products, and it is shown that there are always gains from trade.
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Bibliographic InfoPaper provided by Royal Economic Society in its series Royal Economic Society Annual Conference 2003 with number 47.
Date of creation: 04 Jun 2003
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gains from trade; Bertrand Oligopoly;
Other versions of this item:
- Roger Clarke & David Collie, 2003. "Product differentiation and the gains from trade under Bertrand duopoly," Canadian Journal of Economics, Canadian Economics Association, vol. 36(3), pages 658-673, August.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
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