Second-mover advantage under strategic subsidy policy in a third market model
This paper examines which of the Stackelberg leader or its follower has the advantage under strategic subsidy policy in a third market model. We show that even if governments choose export subsidies in whichever of a simultaneous-move or sequential-move game, the leader firm always loses its first-mover advantage in a Stackelberg duopoly. Furthermore, we examine the endogenous timing of subsidies by governments and show that the second-mover advantage occurs with regard to profit and welfare under the endogenous timing of subsidies.
Volume (Year): 29 (2009)
Issue (Month): 1 ()
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