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Tariffs And Trade Liberalization With Network Externalities

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  • Kenji Fujiwara

    (Kwansei Gakuin University)

Abstract

This paper constructs a reciprocal market model of intra-industry trade in network goods to consider the implications of network externalities for an optimal tari policy and the welfare e ects of bilateral tari reductions. We show that the degree of network externalities nontrivially a ects the sign of the Nash equilibrium tari . Then, we prove that network externalities amplify the gains from tari reductions. These results help better understand the implications of traderelated issues in network industries.

Suggested Citation

  • Kenji Fujiwara, 2011. "Tariffs And Trade Liberalization With Network Externalities," Discussion Paper Series 71, School of Economics, Kwansei Gakuin University, revised May 2011.
    • Handle: RePEc:kgu:wpaper:71
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    References listed on IDEAS

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    1. Alberto Portugal‐Perez & José‐Daniel Reyes & John S. Wilson, 2010. "Beyond the Information Technology Agreement: Harmonisation of Standards and Trade in Electronics," The World Economy, Wiley Blackwell, vol. 33(12), pages 1870-1897, December.
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    Cited by:

    1. Tsaur-Chin Wu & Chih-Ta Yen & Hsiu-Wei Chang, 2023. "Network externalities, trade costs, and the choice of commodity taxation principle," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 30(5), pages 1203-1224, October.
    2. Nasreen Nawaz, 2019. "Dynamics of economic efficiency in tariff and trade," Australian Economic Papers, Wiley Blackwell, vol. 58(4), pages 416-443, December.
    3. Anomita Ghosh & Rupayan Pal, 2017. "Welfare Ranking of Alternative Export Taxes Revisited," Economics Bulletin, AccessEcon, vol. 37(2), pages 1033-1044.
    4. Kangsik Choi & Ki‐Dong Lee, 2022. "Strategic delegation and network externalities under export rivalry market," Manchester School, University of Manchester, vol. 90(1), pages 1-19, January.
    5. Anomita Ghosh & Rupayan Pal, 2014. "Strategic trade policy for network goods oligopolies," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2014-039, Indira Gandhi Institute of Development Research, Mumbai, India.

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