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Trade and Competition Policies: Concordia Discors?

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  • Richardson, Martin

Abstract

Home In a simple model of trade and competition policies we show that the abolition of trade restrictions may lead to governments independently choosing more competitive competition policies. Subsequent co-ordination of competition policy involves encouraging less competitive behaviour than when such policies are not coordinated and may involve disharmonisation, in a sense made clear in the paper. Adding a third country, simulation results indicate that nonmember concerns about customs union formation may be well-founded, particularly when the union goes beyond mere trade policy co-ordination (which may be needed to make it attractive to members in the first place). Copyright 1999 by Royal Economic Society.

Suggested Citation

  • Richardson, Martin, 1999. "Trade and Competition Policies: Concordia Discors?," Oxford Economic Papers, Oxford University Press, vol. 51(4), pages 649-664, October.
  • Handle: RePEc:oup:oxecpp:v:51:y:1999:i:4:p:649-64
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