Strategic trade policy and non-linear subsidy : in the case of price competition
Data(s) |
28/09/2011
28/09/2011
01/03/2011
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Resumo |
In a strategic trade policy, it is assumed, in this paper, that a government changes disbursement or levy method so that the reaction function of home firm approaches infinitely close to that of foreign firm. In the framework of Bertrand-Nash equilibrium, Eaton and Grossman[1986] showed that export tax is preferable to export subsidy. In this paper, it is shown that export subsidy is preferable to export tax in some cases in the framework of Bertrand-Nash equilibrium, considering the uncertainty in demand. Historically, many economists mentioned non-linear subsidy or tax. However, optimum solution of it has not yet been shown. The optimum solution is shown in this paper. |
Identificador |
IDE Discussion Paper. No. 287. 2011.3 http://hdl.handle.net/2344/1069 IDE Discussion Paper 287 |
Idioma(s) |
en eng |
Publicador |
Institute of Developing Economies, JETRO 日本貿易振興機構アジア経済研究所 |
Palavras-Chave | #Trade policy #Exports #Taxation #Strategic trade policy #Non-linear subsidy #Bertrand-Nash equilibrium #Stackelberg equilibrium #678.1 #G World,others #F13 - Commercial Policy; Protection; Promotion; Trade Negotiations; International Organizations #F12 - Models of Trade with Imperfect Competition and Scale Economies #L52 - Industrial Policy; Sectoral Planning Methods #C72 - Noncooperative Games |
Tipo |
Working Paper Technical Report |