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A Ricardian model of international trade with oligopolistic competition

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  • Haiwen Zhou

Abstract

This paper studies a Ricardian model of international trade with a continuum of products in a general equilibrium model in which firms engage in oligopolistic competition. It provides a bridge between trade models based on perfect competition and models based on imperfect competition. Compared with a model based on perfect competition, the incorporation of fixed cost leads to the result that an increase of domestic labor may increase the relative wage of the domestic country.

Suggested Citation

  • Haiwen Zhou, 2010. "A Ricardian model of international trade with oligopolistic competition," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 19(4), pages 499-515.
    • Handle: RePEc:taf:jitecd:v:19:y:2010:i:4:p:499-515
    DOI: 10.1080/09638199.2010.506337
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    1. Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, December.
    2. Haiwen Zhou, 2007. "Increasing Returns, the Choice of Technology, and the Gains from Trade," Southern Economic Journal, John Wiley & Sons, vol. 74(2), pages 581-600, October.
    3. Haiwen Zhou, 2004. "The division of labor and the extent of the market," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 24(1), pages 195-209, July.
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    14. Harry G. Johnson, 1953. "Optimum Tariffs and Retaliation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 21(2), pages 142-153.
    15. Haiwen Zhou, 2007. "Oligopolistic Competition And Economic Geography," Journal of Regional Science, Wiley Blackwell, vol. 47(5), pages 915-933, December.
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    Cited by:

    1. Haiwen Zhou, 2014. "International Trade with Increasing Returns in the Transportation Sector," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 9(4), pages 606-633, December.
    2. Quint, Ansgar F. & Rudsinske, Jonas F., 2020. "International trade and tax-motivated transfer pricing," University of Göttingen Working Papers in Economics 406, University of Goettingen, Department of Economics.

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    More about this item

    Keywords

    comparative advantage; Ricardian model; oligopolistic competition; increasing returns to scale; trade policy;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General

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