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Competition Policy and International Trade

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  • Levinsohn, J.

Abstract

This paper presents a non-technical discussion of economic issues that arise due to links between competition (or anti-trust) policy and international trade. While recent advances in international trade theory have borrowed heavily from the industrial organization literature, this work has a schizophrenic quality to it. One of the insights that motivated the new trade theory was the observation that many markets were not perfectly competitive. For the case of purely domestic markets, the industrial organization literature provided a foundation for policy advice and most countries have well established public policy regarding competition between firms. While trade theorists have borrowed heavily from the theory of industrial organization, they seem to have ignored the existence of competition policy when investigating trade policy. The two interact in important ways, and pretending that trade policy in imperfectly competitive markets takes place in the absence of any competition policy may lead to inadvertent policy outcomes.

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Bibliographic Info

Paper provided by Research Seminar in International Economics, University of Michigan in its series Working Papers with number 362.

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Length: 28 pages
Date of creation: 1994
Date of revision:
Handle: RePEc:mie:wpaper:362

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Postal: ANN ARBOR MICHIGAN 48109
Web page: http://www.fordschool.umich.edu/rsie/
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Keywords: competition ; international trade;

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References

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  1. Raymond Deneckere & Carl Davidson, 1985. "Incentives to Form Coalitions with Bertrand Competition," RAND Journal of Economics, The RAND Corporation, vol. 16(4), pages 473-486, Winter.
  2. Salant, Stephen W & Switzer, Sheldon & Reynolds, Robert J, 1983. "Losses from Horizontal Merger: The Effects of an Exogenous Change in Industry Structure on Cournot-Nash Equilibrium," The Quarterly Journal of Economics, MIT Press, vol. 98(2), pages 185-99, May.
  3. Joseph Farrell and Carl Shapiro., 1988. "Horizontal Mergers: An Equilibrium Analysis," Economics Working Papers 8880, University of California at Berkeley.
  4. repec:fth:coluec:604 is not listed on IDEAS
  5. Larson, David A, 1970. "An Economic Analysis of the Webb-Pomerene Act," Journal of Law and Economics, University of Chicago Press, vol. 13(2), pages 461-500, October.
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Citations

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Cited by:
  1. Sabiston, David R., 2001. "Le pass-through du taux de change," L'Actualité Economique, Société Canadienne de Science Economique, vol. 77(3), pages 425-454, septembre.
  2. Guash, J. Luis & Rajapatirana, Sarath, 1998. "Total strangers or soul mates? - antidumping and competition policies in Latin America and the Caribbean," Policy Research Working Paper Series 1958, The World Bank.
  3. Gasmi, Farid & Hansen, Wendy L. & Laffont, Jean Jacques, 1997. "Une analyse empirique des décisions en matière d’antidumping aux États-Unis," L'Actualité Economique, Société Canadienne de Science Economique, vol. 73(1), pages 423-456, mars-juin.
  4. Horst Raff & Nicolas Schmitt, 2000. "Endogenous Vertical Restraints in International Trade," Discussion Papers dp00-04, Department of Economics, Simon Fraser University, revised Feb 2000.
  5. Joseph F. Francois & Henrik Horn, 1998. "Competition Policy in an Open Economy," Tinbergen Institute Discussion Papers 98-092/2, Tinbergen Institute.
  6. Joseph F. Francois & Henrik Horn, 1998. "Competition Policy in an Open Economy," Tinbergen Institute Discussion Papers 98-092/2, Tinbergen Institute.
  7. repec:ebl:ecbull:v:6:y:2002:i:5:p:1-7 is not listed on IDEAS
  8. repec:dgr:uvatin:2098092 is not listed on IDEAS

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