Quality-Improving R&D, Trade Barriers, and Foreign Direct Investment
AbstractThis investigation pits Cournot oligopolists against each other in a model of quality and R&D choice. A firm gains a strategic advantage over its rival when it is able to sell in more countries due to the jointness of quality improvements across production locations. Trade barriers that restrict access to a market put the restricted firm at a disadvantage, the degree of disadvantage being stronger under a quota than under a tariff. Given that FDI (foreign direct investment) depends on this disadvantage, quotas present a stronger incentive to undertake FDI than a tariff. Also, in this model it is never possible for a quota to lead to quality upgrading of imports due to the associated disadvantage of the importing firm in quality-improving R&D.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Hawaii at Manoa, Department of Economics in its series Working Papers with number 199712.
Length: 33 pages
Date of creation: 1997
Date of revision:
Note: Rough draft--please do not cite without permission from the author.
Contact details of provider:
Postal: 2424 Maile Way, Honolulu, HI 96822
Web page: http://www.economics.hawaii.edu/
More information through EDIRC
Find related papers by JEL classification:
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Web Technician).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.