Journal article
The size of trading blocs Market power and world welfare effects
Journal of international economics, v 40(3), pp 411-437
01 May 1996
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Abstract
We construct an
n-country
n-commodity trade model to analyze the implications of bloc size for (Nash) equilibrium tariffs and welfare. The relationship between the absolute size of (symmetric) trading blocs and their market power is ambiguous, and we illustrate how this relationship varies with model parameters. In contrast, sufficiently large increases in the relative size of a bloc enhance its relative market power and cause the welfare of its country members to rise above the free trade level. We establish the existence of an optimal bloc size, and study the dependence of optimal size on the parameters of the model.
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Details
- Title
- The size of trading blocs Market power and world welfare effects
- Creators
- Eric W. Bond - Pennsylvania State UniversityConstantinos Syropoulos - Pennsylvania State University
- Publication Details
- Journal of international economics, v 40(3), pp 411-437
- Publisher
- Elsevier
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Economics (School of Economics)
- Web of Science ID
- WOS:A1996VP52000007
- Scopus ID
- 2-s2.0-0000133459
- Other Identifier
- 991021807106804721
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- Web of Science research areas
- Economics