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Time-Consistent Protection With Learning by Doing

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  • Miravete, E.J.

Abstract

This paper studies whether it is possible to characterize an optimal, time-consistent tariff to protect an infant-industry in the presence of learning effects. A domestic monopolist decides how much to produce, taking into account learning effects induced by its current production, while the governemnt decides on the level of tariff protection. In order to ensure time consistency and characterize the optimal policy i solve the case where learning leads to lower fixed costs..

Suggested Citation

  • Miravete, E.J., 1997. "Time-Consistent Protection With Learning by Doing," UFAE and IAE Working Papers 395.97, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    • Handle: RePEc:aub:autbar:395.97
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    References listed on IDEAS

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    1. Dermot Leahy & J. Peter Neary, 1999. "Learning by Doing, Precommitment and Infant-Industry Promotion," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 66(2), pages 447-474.
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    15. Miravete, Eugenio J., 2003. "Time-consistent protection with learning by doing," European Economic Review, Elsevier, vol. 47(5), pages 761-790, October.
    16. Reynolds, Stanley S, 1987. "Capacity Investment, Preemption and Commitment in an Infinite Horizon Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 28(1), pages 69-88, February.
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    Cited by:

    1. Kresimir Zigic, 2011. "Strategic Interactions in Markets with Innovative Activity: The Cases of Strategic Trade Policy and Market Leadership," CERGE-EI Books, The Center for Economic Research and Graduate Education - Economics Institute, Prague, edition 1, number b06, May.
    2. Vives, Xavier & Jun, Byoung, 2001. "Incentives in Dynamic Duopoly," CEPR Discussion Papers 2899, C.E.P.R. Discussion Papers.
    3. Steffen Jørgensen & Georges Zaccour, 2007. "Developments in differential game theory and numerical methods: economic and management applications," Computational Management Science, Springer, vol. 4(2), pages 159-181, April.
    4. Miravete, Eugenio J., 2003. "Time-consistent protection with learning by doing," European Economic Review, Elsevier, vol. 47(5), pages 761-790, October.
    5. Makoto Kakinaka & Koji Kotani, 2006. "Promotion of Eco-Products and Environmental Regulation with Learning-by-Doing," Working Papers EMS_2006_07, Research Institute, International University of Japan.
    6. Karim El Mokri, 2016. "Morocco’s 2014- 2020 Industrial Strategy and its potential implications for the structural transformation process," Policy notes & Policy briefs 1628, Policy Center for the New South.
    7. Calzolari, Giacomo & Lambertini, Luca, 2007. "Export restraints in a model of trade with capital accumulation," Journal of Economic Dynamics and Control, Elsevier, vol. 31(12), pages 3822-3842, December.
    8. Delia Baghdasaryan & Krešimir Žigić, 2010. "Tariffs, market conduct and government commitment," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 18(1), pages 91-122, January.
    9. Kogan, Konstantin & El Ouardighi, Fouad & Herbon, Avi, 2017. "Production with learning and forgetting in a competitive environment," International Journal of Production Economics, Elsevier, vol. 189(C), pages 52-62.
    10. Bläsi, Albrecht & Requate, Till, 2005. "Learning-by-Doing with Spillovers in Competitive Industries, Free Entry, and Regulatory Policy," Economics Working Papers 2005-09, Christian-Albrechts-University of Kiel, Department of Economics.
    11. Agnieszka Hajdukiewicz & Bożena Pera, 2020. "International Trade Disputes over Renewable Energy—the Case of the Solar Photovoltaic Sector," Energies, MDPI, vol. 13(2), pages 1-23, January.
    12. Siebert Ralph B, 2010. "Learning-by-Doing and Cannibalization Effects at Multi-Vintage Firms: Evidence from the Semiconductor Industry," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-32, May.
    13. Delia Ionaºcu & Kresimir Zigic, 2005. "Strategic Tariff Protection, Market Conduct, and Government Commitment Levels in Developing Economies," CERGE-EI Working Papers wp249, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    14. Koji Kotani & Makoto Kakinaka, 2017. "Some implications of environmental regulation on social welfare under learning-by-doing of eco-products," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 19(1), pages 121-149, January.
    15. Saure, Philip, 2007. "Revisiting the infant industry argument," Journal of Development Economics, Elsevier, vol. 84(1), pages 104-117, September.
    16. Vladimir Petkov, 2007. "Infant Firm Subsidization in Industries with Dynamic Structure," Journal of Industry, Competition and Trade, Springer, vol. 7(2), pages 73-93, June.
    17. Dijkstra, Bouwe R., 2007. "An investment contest to influence environmental policy," Resource and Energy Economics, Elsevier, vol. 29(4), pages 300-324, November.
    18. Greetje Everaert, 2003. "Technology Adoption under Price Undertakings," LICOS Discussion Papers 13703, LICOS - Centre for Institutions and Economic Performance, KU Leuven.

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    More about this item

    Keywords

    GAME THEORY ; TRADE;

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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