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Globalisation and market structure

  • J. Peter Neary

This paper reviews some puzzling economic aspects of globalisation and argues that they cannot be satisfactorily addressed in perfectly or monopolistically competitive models. Drawing on recent work, a model of oligopoly in general equilibrium is sketched. The model ensures theoretical consistency by assuming that firms are large in their own markets but small in the economy as a whole, and ensures tractability by assuming quadratic preferences defined over a continuum of goods. Applications considered include the effects of trade liberalisation on industrial structure, on cross-border merger waves, and on the distribution of income between skilled and unskilled workers.

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File URL: http://hdl.handle.net/10197/1306
File Function: First version, 2002
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Paper provided by School of Economics, University College Dublin in its series Working Papers with number 200220.

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Date of creation: Aug 2002
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Handle: RePEc:ucn:wpaper:200220
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