Interactions Between The Domestic And International Trade Policies: A Strategic Trade Model Of Us Wheat Programs
The objective of this study is to determine the likely changes in the domestic and international trade policies in wheat markets, and the consequent market impact. A two-nation, two-firm model is developed for a homogeneous good in two markets. The model is a three-stage noncooperative game, where firms make political contributions to gain support for trade policies and compete by determining output levels. The model shows that in the global wheat market, producers could gain by increasing market share through competitive free trade, with reductions in political payments. The implications of the results on the Doha round of trade negotiations are also discussed.
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Volume (Year): III (2006)
Issue (Month): 4 (October)
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