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Strategic Trade Policy and Network Compatibility

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  • Tsuyoshi Toshimitsu

    (Kwansei Gakuin University)

Abstract

We consider strategic trade policy for information and communication technology (ICT) product markets with international rivalry. Usually, ICT products exhibit network externalities and product compatibility (i.e., network compatibility). We demonstrate that the optimal strategic trade policy depends on the degree of network compatibility of ICT products. Furthermore, using an endogenous decision game for strategic variables (i.e., quantity and price), we consider the relationship between the optimal strategic trade policies and the endogenous mode of competition.

Suggested Citation

  • Tsuyoshi Toshimitsu, 2017. "Strategic Trade Policy and Network Compatibility," Journal of Industry, Competition and Trade, Springer, vol. 17(2), pages 237-249, June.
    • Handle: RePEc:kap:jincot:v:17:y:2017:i:2:d:10.1007_s10842-016-0235-y
    DOI: 10.1007/s10842-016-0235-y
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    References listed on IDEAS

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    Cited by:

    1. Luciano Fanti & Domenico Buccella, 2023. "Vertical industry and strategic trade policy," SN Business & Economics, Springer, vol. 3(2), pages 1-16, February.

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    More about this item

    Keywords

    Strategic trade policy; International rivalry; Network compatibility; Horizontally differentiated duopoly; Endogenous mode of competition;
    All these keywords.

    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
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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