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Trade in imperfectly competitive industries: the role of market size and consumer preferences

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  • Stephen Devadoss
  • Kent Lanclos

Abstract

This study presents theoretical and empirical analyses of market size and consumer preference asymmetries to examine the implications of trade and trade policies for imperfectively competitive food manufacturing sectors. The results show that the effects of trade reforms on imperfectly competitive product trade are counter intuitive if a significant portion of food trade is attributed to market size and preference asymmetries. For example, countries with smaller market gain relatively more from trade liberalization than countries with larger markets because export market opportunities are greater for small countries than for large countries.

Suggested Citation

  • Stephen Devadoss & Kent Lanclos, 2000. "Trade in imperfectly competitive industries: the role of market size and consumer preferences," Applied Economics, Taylor & Francis Journals, vol. 32(9), pages 1189-1200.
    • Handle: RePEc:taf:applec:v:32:y:2000:i:9:p:1189-1200
    DOI: 10.1080/000368400404335
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    References listed on IDEAS

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    7. Nguyen, Trien T. & Wigle, Randall M., 1992. "Trade liberalisation with imperfect competition : The large and the small of it," European Economic Review, Elsevier, vol. 36(1), pages 17-35, January.
    8. D. Kent Lanclos & Thomas W. Hertel, 1995. "Endogenous Product Differentiation and Trade Policy: Implications for the U.S. Food Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(3), pages 591-601.
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    Cited by:

    1. Chung-Fu Lai, 2016. "Tariff, Consumption Home Bias and Macroeconomic Dynamics," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 6(8), pages 425-444, August.
    2. Miller, Andrew D. & Langley, Suchada V. & Chambers, William, 2003. "Current Issues Affecting Trade And Trade Policy: An Annotated Literature Review," Working Papers 14606, International Agricultural Trade Research Consortium.
    3. Zulfiqar Bashir, 2003. "The Impacts of Economic Reforms and Trade Liberalisation on Agricultural Export Performance in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 42(4), pages 941-960.

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