Antitrust in Open Economies
AbstractWe examine antitrust rules in a two county general equilibrium trade model, contrasting national and multilateral (cooperative) determination of competition policy, exploring the properties of the policy equilibrium. It is not imperfect competition, but variation in competitive stance between sectors that matters for trading partners. Beggar-thy-neighbor competition policies relate to countries’ comparative advantages, and hurt the factor intensively used, or specific to, the imperfectly competitive sector. They also create a competitive advantage for export firms. FDI can be pro-competitive in this context, reducing the scope for beggar-thy-neighbor policies and reducing the gains from a multilateral competition agreement.
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Bibliographic InfoPaper provided by IIIS in its series The Institute for International Integration Studies Discussion Paper Series with number iiisdp120.
Date of creation: 05 Apr 2006
Date of revision:
antitrust policy; competition policy; merger policy; trade and imperfect competition; FDI;
Other versions of this item:
- Francois, Joseph & Horn, Henrik, 2006. "Antitrust in Open Economies," CEPR Discussion Papers, C.E.P.R. Discussion Papers 5480, C.E.P.R. Discussion Papers.
- Joseph Francois & Henrik Horn, 2006. "Antitrust in Open Economies," Tinbergen Institute Discussion Papers 06-006/2, Tinbergen Institute.
- L4 - Industrial Organization - - Antitrust Issues and Policies
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- F3 - International Economics - - International Finance
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