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Energy imports and manufacturing exports with successive oligopolies and storage

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  • Arnold, Lutz G.
  • Arnold, Volker

Abstract

Many industrial countries run a “business model” that is based on oligopolistic export industries which strongly depend on energy imports. This paper uses an analytically tractable general equilibrium model of international trade with successive oligopolies and storage to analyze optimum trade and industrial policies for such countries. There can be over-investment in storage for strategic reasons. Despite double marginalization, there is a non-zero optimum level of market concentration for the domestic industry. The optimum import tariff is most likely positive. Subsidies to storage and reduced use of long term contracts usually raise domestic welfare.

Suggested Citation

  • Arnold, Lutz G. & Arnold, Volker, 2024. "Energy imports and manufacturing exports with successive oligopolies and storage," Energy Economics, Elsevier, vol. 133(C).
    • Handle: RePEc:eee:eneeco:v:133:y:2024:i:c:s014098832400166x
    DOI: 10.1016/j.eneco.2024.107458
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    References listed on IDEAS

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    More about this item

    Keywords

    Energy imports; Successive oligopolies; Storage; Trade policy;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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