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National Oligopolies and Economic Geography

Author

Listed:
  • Barbara Annicchiarico

    () (Department of Economics - Università degli Studi di Roma Tor Vergata [Roma])

  • Federica Orioli

    () (LUISS - Libera Università Internazionale degli Studi Sociali Guido Carli [Roma])

  • Federico Trionfetti

    () (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université - EHESS - École des hautes études en sciences sociales)

Abstract

We replace monopolistic competition with national oligopolies in a model of "new economic geography". There are many possible bifurcation diagrams but, unlike in monopolistic competition, the symmetric equilibrium is always stable for low trade costs. The antitrust policy, though identical in both countries, affects the geographical distribution of firms. In turn, migration attenuates the effectiveness of the antitrust policy in eliminating collusive behavior. For high trade costs a toughening of the antitrust policy is likely to result in more agglomeration and may reduce world welfare. The antitrust policy is more likely to be welfare improving when market integration progresses.

Suggested Citation

  • Barbara Annicchiarico & Federica Orioli & Federico Trionfetti, 2011. "National Oligopolies and Economic Geography," Working Papers halshs-00607641, HAL.
  • Handle: RePEc:hal:wpaper:halshs-00607641
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00607641
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    References listed on IDEAS

    as
    1. Ludema, Rodney D. & Wooton, Ian, 2000. "Economic geography and the fiscal effects of regional integration," Journal of International Economics, Elsevier, vol. 52(2), pages 331-357, December.
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    More about this item

    Keywords

    Spatial Oligopoly; Antitrust Policy; Welfare;

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

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