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Public Policy In Vertically Related Markets: A Cournot Oligopoly-Oligopsony Model

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  • Desquilbet, Marion
  • Guyomard, Herve

Abstract

We use a partial equilibrium two-country model, with two vertically related markets, with perfect competition in the primary good sector and with a fixed number of processing firms in each country, characterized by a Cournot behavior upstream and downstream. In the first stage of the game, the government of the exporting country chooses the level of price instruments on both goods. The targeting principle is used to characterize optimal intervention in presence of a minimum revenue constraint towards primary producers.

Suggested Citation

  • Desquilbet, Marion & Guyomard, Herve, 1999. "Public Policy In Vertically Related Markets: A Cournot Oligopoly-Oligopsony Model," 1999 Annual meeting, August 8-11, Nashville, TN 21561, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea99:21561
    DOI: 10.22004/ag.econ.21561
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    References listed on IDEAS

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    1. McCorriston, Steve & Sheldon, Ian M, 1996. "The Effects of Vertical Markets on Trade Policy Reform," Oxford Economic Papers, Oxford University Press, vol. 48(4), pages 664-672, October.
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    5. Jonathan Eaton & Gene M. Grossman, 1986. "Optimal Trade and Industrial Policy Under Oligopoly," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 101(2), pages 383-406.
    6. Cheng, Leonard K, 1988. "Assisting Domestic Industries under International Oligopoly: The Relevance of the Nature of Competition to Optimal Policies," American Economic Review, American Economic Association, vol. 78(4), pages 746-758, September.
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    Cited by:

    1. Arijit Mukherjee, 2002. "Licensing in a Vertically Separated Industry," Industrial Organization 0211005, University Library of Munich, Germany.

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    Keywords

    vertically related markets; imperfect;

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