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Tariffs, market conduct and goverment commitment : policy implications for developing countries

Author

Listed:
  • Delia Baghdasaryan

    (GAEL - Laboratoire d'Economie Appliquée = Grenoble Applied Economics Laboratory - UPMF - Université Pierre Mendès France - Grenoble 2 - INRA - Institut National de la Recherche Agronomique - CNRS - Centre National de la Recherche Scientifique)

  • Kresimir Zigic

    (Center for Economic Research and Graduate Education - Economics Institute)

Abstract

The authors analyse a simple ‘tariffs cum foreign competition' policy targeted at enhancing the competitive position of a domestic, developing country firm that competes with its developed country counterpart on the domestic market and that carries out an innovative (or imitative) effort. They evaluate this policy with respect to social welfare, type of oligopoly conduct, information requirement, time consistency and possibility of manipulative behaviour and conclude that the most robust policy setup is one in which the domestic government is unable to pre-commit to the level of its policy. They also study how the unit cost heterogeneity of the domestic firm affects trade protection.

Suggested Citation

  • Delia Baghdasaryan & Kresimir Zigic, 2010. "Tariffs, market conduct and goverment commitment : policy implications for developing countries," Post-Print hal-02654942, HAL.
    • Handle: RePEc:hal:journl:hal-02654942
    DOI: 10.1111/j.1468-0351.2009.00372.x
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    Cited by:

    1. Luciano Fanti & Domenico Buccella, 2020. "Strategic trade policy with socially concerned firms," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(3), pages 269-292, September.

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