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Export Subsidies And Switching Costs In An Imperfectly Competitive International Wheat Market


  • Kallio, Panu K.S.
  • Abbott, Philip C.


Switching costs affect importer decisions, hence impacts of subsidies over time. Dynamic, game theoretic simulations of EU-US competition for Moroccan wheat imports suggest firms charge lower prices and governments award higher subsidies with switching costs. Policy under alternative institutional arrangements depends on the extent of switching costs, measured here econometrically.

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  • Kallio, Panu K.S. & Abbott, Philip C., 1998. "Export Subsidies And Switching Costs In An Imperfectly Competitive International Wheat Market," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20789, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea98:20789

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    References listed on IDEAS

    1. Neary, J. Peter, 1994. "Cost asymmetries in international subsidy games: Should governments help winners or losers?," Journal of International Economics, Elsevier, vol. 37(3-4), pages 197-218, November.
    2. Beggs, Alan W & Klemperer, Paul, 1992. "Multi-period Competition with Switching Costs," Econometrica, Econometric Society, vol. 60(3), pages 651-666, May.
    3. Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, July.
    4. Klemperer, Paul, 1992. "Competition When Consumers Have Switching Costs: An Overview," CEPR Discussion Papers 704, C.E.P.R. Discussion Papers.
    5. Gehlhar, Mark J. & Vollrath, Thomas L., 1997. "U.S. Export Performance in Agricultural Markets," Technical Bulletins 156793, United States Department of Agriculture, Economic Research Service.
    6. Sapir, Andre & Sekkat, Khalid, 1995. "Exchange rate regimes and trade prices Does the EMS matter?," Journal of International Economics, Elsevier, vol. 38(1-2), pages 75-94, February.
    7. Johnson, Martin & Mahe, Louis & Roe, Terry, 1993. "Trade compromises between the European community and the United States: An interest group-game theory," Journal of Policy Modeling, Elsevier, vol. 15(2), pages 199-222, April.
    8. Philip C. Abbott & Panu K. S. Kallio, 1996. "Implications of Game Theory for International Agricultural Trade," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(3), pages 738-744.
    9. Ballard, Charles L & Shoven, John B & Whalley, John, 1985. "General Equilibrium Computations of the Marginal Welfare Costs of Taxes in the United States," American Economic Review, American Economic Association, vol. 75(1), pages 128-138, March.
    10. To, Theodore, 1994. "Export subsidies and oligopoly with switching costs," Journal of International Economics, Elsevier, vol. 37(1-2), pages 97-110, August.
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    Cited by:

    1. Young, Linda M. & Abbott, Philip C. & Leetmaa, Susan E., 2001. "Export Competition: Issues And Options In The Agricultural Negotiations," Commissioned Papers 14624, International Agricultural Trade Research Consortium.


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