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Competition Policy and International Trade

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James Levinsohn

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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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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4972.

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Date of creation: Dec 1994
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Handle: RePEc:nbr:nberwo:4972

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F10 - International Economics - - Trade - - - General

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. 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. [Downloadable!] (restricted)
  2. Bhagwati, J., 1992. "Fair Trade, Reciprocity and Harmonization: The New Challenge to the Theory and Policy of Free Trade," Discussion Papers 1992_20, Columbia University, Department of Economics.
  3. Farrell, Joseph & Shapiro, Carl, 1990. "Horizontal Mergers: An Equilibrium Analysis," American Economic Review, American Economic Association, vol. 80(1), pages 107-26, March. [Downloadable!] (restricted)
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  4. Larson, David A, 1970. "An Economic Analysis of the Webb-Pomerene Act," Journal of Law & Economics, University of Chicago Press, vol. 13(2), pages 461-500, October.
  5. 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. [Downloadable!] (restricted)
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  1. 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. [Downloadable!]
  2. Donghyun Park & Jung Hur, 2002. "Exports Under an Import Substitution Trade Regime: An Alternative View," Economics Bulletin, Economics Bulletin, vol. 6(5), pages 1-7. [Downloadable!]
  3. Horst Raff & Nicolas Schmitt, 2000. "Endogenous Vertical Restraints in International Trade," Discussion Papers dp00-04, Department of Economics, Simon Fraser University, revised Feb 2000. [Downloadable!]
    Other versions:
  4. Joseph F. Francois & Henrik Horn, 1998. "Competition Policy in an Open Economy," Tinbergen Institute Discussion Papers 98-092/2, Tinbergen Institute. [Downloadable!]
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This page was last updated on 2009-11-25.

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