Horizontal Regulatory Protection. Its appeal and implictions in a linear Cournot duopoly
I set up a linear model of a cross-hauling, Cournot duopoly. Even where countries are small, there exists a motive for protection to achieve a profit-shift and to raise revenue. Where the protection is of tariff form, then the protection will only totally exclude the foreign firm for a limited set of parameter values. By contrast, where the protection takes the form of a horizontal technical barrier to trade (HTBT), the government will always exclude the foreign firm. Where there is no constraint on imposing tariffs, these will always be preferred to the HTBT. However, if tariff reductions are imposed by international agreement without simultaneous restrictions on HTBTs, then reductions below a threshold level will trigger imposition of an HTBT sufficient to totally exclude the foreign firm.
|Date of creation:||Feb 2007|
|Date of revision:||Feb 2007|
|Contact details of provider:|| Postal: |
Phone: +44 (0) 1509 222701
Fax: +44 (0) 1509 223910
Web page: http://www.lboro.ac.uk/departments/sbe/research/economics/index.html
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lutz, Stefan, 1996. "Vertical Product Differentiation, Quality Standards, and International Trade Policy," CEPR Discussion Papers 1443, C.E.P.R. Discussion Papers.
- James A. Brander & Barbara J. Spencer, 1984.
"Export Subsidies and International Market Share Rivalry,"
NBER Working Papers
1464, National Bureau of Economic Research, Inc.
- Brander, James A. & Spencer, Barbara J., 1985. "Export subsidies and international market share rivalry," Journal of International Economics, Elsevier, vol. 18(1-2), pages 83-100, February.
- H. Lutz, Stefan, 2000.
"Trade Effects of Minimum Quality Standards with and without Deterred Entry,"
Journal of Economic Integration,
Center for Economic Integration, Sejong University, vol. 15, pages 314-344.
- Lutz, Stefan, 1996. "Trade Effects of Minimum Quality Standards with and without Deterred Entry," CEPR Discussion Papers 1384, C.E.P.R. Discussion Papers.
- T. Huw Edwards, 2004. "Trade and Strategic Regulatory Bias in Monopolistic Industries," Discussion Paper Series 2004-21, Department of Economics, Loughborough University, revised Sep 2004.
- Das, Satya P. & Donnenfeld, Shabtai, 1989. "Oligopolistic competition and international trade : Quantity and quality restrictions," Journal of International Economics, Elsevier, vol. 27(3-4), pages 299-318, November.
When requesting a correction, please mention this item's handle: RePEc:lbo:lbowps:2007_05. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Huw Edwards)
If references are entirely missing, you can add them using this form.