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Trade policy and mixed enterprises

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  • Ngo Van Long
  • Frank Stähler

Abstract

This paper demonstrates that the degree of state ownership affects neither the level of socially optimal activities nor welfare if the government chooses optimal trade policy instruments. In the case of rivalry in the home market, the optimal import tariff is independent of the degree of state ownership, and the optimal production subsidy decreases with state ownership if the optimal tariff is positive. For the case of Cournot rivalry in a third market, the optimal export subsidy increases with state ownership, while in the case of Bertrand rivalry with differentiated products, the optimal export tax increases with state ownership.

Suggested Citation

  • Ngo Van Long & Frank Stähler, 2009. "Trade policy and mixed enterprises," Canadian Journal of Economics, Canadian Economics Association, vol. 42(2), pages 590-614, May.
  • Handle: RePEc:cje:issued:v:42:y:2009:i:2:p:590-614
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Wang, Leonard F.S. & Tomaru, Yoshihiro, 2015. "The feasibility of privatization and foreign penetration," International Review of Economics & Finance, Elsevier, vol. 39(C), pages 36-46.
    2. Dapeng Cai & Yukio Karasawa-Ohtashiro, 2015. "International cross-ownership of firms and strategic privatization policy," Journal of Economics, Springer, vol. 116(1), pages 39-62, September.
    3. repec:kap:jeczfn:v:120:y:2017:i:3:d:10.1007_s00712-016-0502-8 is not listed on IDEAS
    4. Matsushima, Noriaki & Takauchi, Kazuhiro, 2014. "Port privatization in an international oligopoly," Transportation Research Part B: Methodological, Elsevier, vol. 67(C), pages 382-397.
    5. Chang, Winston W. & Ryu, Han Eol, 2016. "Export rivalry, vertically-related markets, and optimal public ownership policy," Economic Modelling, Elsevier, vol. 54(C), pages 392-401.
    6. Xu, Lili & Lee, Sang-Ho & Wang, Leonard, 2017. "Strategic Trade and Privatization Policies in Bilateral Mixed Markets," MPRA Paper 80340, University Library of Munich, Germany.
    7. Stähler, Frank & Traub, Stefan, 2009. "Privatization and liberalization in vertically linked markets," TranState Working Papers 95, University of Bremen, Collaborative Research Center 597: Transformations of the State.
    8. repec:hal:journl:halshs-01314650 is not listed on IDEAS
    9. Wang, Leonard F.S. & Chen, Tai-Liang, 2011. "Mixed oligopoly, optimal privatization, and foreign penetration," Economic Modelling, Elsevier, vol. 28(4), pages 1465-1470, July.
    10. Leonard Wang & Jen-yao Lee & Chin-shu Huang, 2012. "Maximum-Revenue and Optimum-Welfare Tariffs in International Mixed Duopoly: Does the Order of Firms’ Move Matter?," Journal of Industry, Competition and Trade, Springer, vol. 12(3), pages 273-283, September.
    11. Arghya Ghosh & Manipushpak Mitra & Bibhas Saha, 2015. "Privatization, Underpricing, and Welfare in the Presence of Foreign Competition," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 17(3), pages 433-460, June.
    12. Thanh Le & Cuong Le Van, 2016. "Trade Liberalisation and Optimal R&D Policies in a Model of Exporting Firms Conducting Process Innovation," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01314650, HAL.
    13. Ming Lin & Toshihiro Matsumura, 2012. "Presence of foreign investors in privatized firms and privatization policy," Journal of Economics, Springer, vol. 107(1), pages 71-80, September.
    14. Wang, Chia-Chi & Chiou, Jiunn-Rong, 2015. "An analysis of policy harmonization on privatization and trade liberalization," International Review of Economics & Finance, Elsevier, vol. 38(C), pages 279-290.
    15. Wang, Leonard F.S. & Lee, Jen-yao & Hsu, Chu-chuan, 2014. "Privatization, foreign competition, and social efficiency of free entry," International Review of Economics & Finance, Elsevier, vol. 31(C), pages 138-147.
    16. Leonard F.S. Wang & Jen-yao Lee, 2010. "Partial Privatization, Foreign Competition, and Tariffs Ranking," Economics Bulletin, AccessEcon, vol. 30(3), pages 2405-2412.
    17. Xu, Lili & Lee, Sang-Ho & Wang, Leonard F.S., 2016. "Free trade agreements and privatization policy with an excess burden of taxation," Japan and the World Economy, Elsevier, vol. 37, pages 55-64.
    18. Shuai Niu, 2015. "Privatization in the presence of patent licensing," Journal of Economics, Springer, vol. 116(2), pages 151-163, October.

    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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