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Tariffs, Spillovers and North-South Trade


  • Kresimir Zigic

    (CERGE, Charles University, Prague)


In this paper, author examine the issue of the optimal tariff in circumstances in which trade between the ‘North’ (a developed country) and the ‘South’ (a developing country) takes place. Firms compete in quantities (‘Cournot competition’) in an imperfectly competitive Northern market. In addition, there are leakages of technological knowledge (‘spillovers’) from the North to the South. The interaction between tariffs and spillovers, together with its consequences for the social welfare of the North, is the focus of the paper. Another closely related motivation of this paper stems from the observation that the so called punitive tariffs are being used as device to punish violators of intellectual property rights.

Suggested Citation

  • Kresimir Zigic, 1998. "Tariffs, Spillovers and North-South Trade," Zagreb International Review of Economics and Business, Faculty of Economics and Business, University of Zagreb, vol. 1(2), pages 21-46, November.
  • Handle: RePEc:zag:zirebs:v:1:y:1998:i:2:p:21-46

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    More about this item


    Tarrif; intellectual property rights; spillovers; strategic trade; duopoly; constrained monopoly;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets


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