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An elementary proposition concerning parallel imports

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  • Richardson, Martin

Abstract

This paper demonstrates that, when countries individually choose whether or not to prohibit parallel imports, a global Nash equilibrium involves the permitting of parallel importing into all relevant foreign markets i.e. global uniform pricing. This result is sensitive in a straightforward way to the tariff-setting powers of countries and to the specification of a government’s objective function (i.e. political economy considerations). We also show that when countries can prevent “parallel exports” then any Nash equilibrium involves global price discrimination.
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  • Richardson, Martin, 2002. "An elementary proposition concerning parallel imports," Journal of International Economics, Elsevier, vol. 56(1), pages 233-245, January.
    • Handle: RePEc:eee:inecon:v:56:y:2002:i:1:p:233-245
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    5. Postlep, Rolf-Dieter & Wagner, Gert G., 1998. "Zur Ökonomik grundfinanzierter wirtschafts- und sozialwissenschaftlicher Forschung," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 217(3), pages 346-358.
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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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