We develop a partial equilibrium model in which identical foreign firms locate in a host country and export their produce to another country (the consuming country). These firms compete with domestic firms in the consuming country under oligopoly. The two sets of firms differ in cost structures. There exists unemployment in both countries. We consider two cases depending on whether or not the foreign firms have the outside options of investing elsewhere.
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Paper provided by Osaka - Institute of Social and Economic Research in its series Papers with number
456.
Length: 17 pages Date of creation: 1998 Date of revision: Handle: RePEc:fth:osakae:456
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Find related papers by JEL classification: F2 - International Economics - - International Factor Movements and International Business H2 - Public Economics - - Taxation, Subsidies, and Revenue
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