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Unilateral and Multilateral Gains from Trade in International Oligopoly

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  • KENJI FUJIWARA

Abstract

Constructing a two-agent model of international duopoly with increasing returns, the present paper examines potential gains from free trade. It is shown that under certain conditions, both agents in a country become worse off in free trade than in autarky with no redistribution. Further, the lump-sum compensation can never achieve a Pareto-improvement in such an economy. However, we can find a non-lump-sum redistributive scheme that makes nobody in the country worse off in free trade than in autarky. Copyright 2005 The Economic Society Of Australia.

Suggested Citation

  • Kenji Fujiwara, 2005. "Unilateral and Multilateral Gains from Trade in International Oligopoly," The Economic Record, The Economic Society of Australia, vol. 81(255), pages 404-413, December.
  • Handle: RePEc:bla:ecorec:v:81:y:2005:i:255:p:404-413
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    Cited by:

    1. repec:ebl:ecbull:v:6:y:2006:i:5:p:1-8 is not listed on IDEAS
    2. Toru Kikuchi & Kazumichi Iwasa, 2009. "Competing Industrial Standards and the Impact of Trade Liberalization:Revised and Enlarged," Discussion Papers 0913, Graduate School of Economics, Kobe University.
    3. Murray C. Kemp, 2010. "The Gains from Trade in a Cournot-Nash Trading Equilibrium," Review of International Economics, Wiley Blackwell, vol. 18(5), pages 832-834, November.
    4. Kenji Fujiwara, 2006. "Why Resisting Globalization Can Be Reasonable," Economics Bulletin, AccessEcon, vol. 6(5), pages 1-8.

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