Journal article
Nontariff Trade Controls and Leader-Follower Relations in International Competition
Economica (London), v 63(252), pp 633-648
01 Nov 1996
Featured in Collection : UN Sustainable Development Goals @ Drexel
Abstract
A simple duopoly model is constructed in which leader-follower relations arise as part of a subgame-perfect equilibrium in a game of endogenous timing. I show that, in the absence of policy intervention, cost asymmetries between firms can help sustain collusive hierarchical organization of markets. On the basis of this model, I then analyse the effects of VERs and import quotas in the presence of foreign and international duopolies. My analysis reveals that, in contrast to the existing literature, these nontariff trade controls can break the stability of leader-follower relations and thereby raise an importing country's welfare.
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Details
- Title
- Nontariff Trade Controls and Leader-Follower Relations in International Competition
- Creators
- Constantinos Syropoulos
- Publication Details
- Economica (London), v 63(252), pp 633-648
- Publisher
- The Suntory-Toyota International Centre for Economics and Related Disciplines
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Economics (School of Economics)
- Web of Science ID
- WOS:A1996WB11600007
- Scopus ID
- 2-s2.0-5844355417
- Other Identifier
- 991021807014104721
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- Web of Science research areas
- Economics