IDEAS home Printed from https://ideas.repec.org/a/eee/reecon/v63y2009i3p165-171.html
   My bibliography  Save this article

Trade liberalization in a differentiated duopoly reconsidered

Author

Listed:
  • Fujiwara, Kenji

Abstract

Constructing a model of differentiated Cournot duopoly, we consider welfare effects of trade liberalization (i.e. reductions in transport costs). We examine both multilateral trade (i.e. the firms in both countries export bilaterally) and unilateral trade, under which foreign entry is possible but the home firm cannot export. Some new results on trade gains under differentiated oligopoly are proved and their implications are discussed.

Suggested Citation

  • Fujiwara, Kenji, 2009. "Trade liberalization in a differentiated duopoly reconsidered," Research in Economics, Elsevier, vol. 63(3), pages 165-171, September.
    • Handle: RePEc:eee:reecon:v:63:y:2009:i:3:p:165-171
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1090-9443(09)00027-1
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Murray C. Kemp & Koji Shimomura, 2001. "Gains From Trade in a Cournot–Nash General Equilibrium," The Japanese Economic Review, Japanese Economic Association, vol. 52(3), pages 284-302, September.
    2. Roger Clarke & David Collie, 2003. "Product differentiation and the gains from trade under Bertrand duopoly," Canadian Journal of Economics, Canadian Economics Association, vol. 36(3), pages 658-673, August.
    3. Murray Kemp & Koji Shimomura, 1995. "The Apparently Innocuous Representative Agent," The Japanese Economic Review, Japanese Economic Association, vol. 46(3), pages 247-256, September.
    4. David R. Collie, 1996. "Gains and losses from unilateral free trade under oligopoly," Discussion Papers (REL - Recherches Economiques de Louvain) 1996024, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    5. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
    6. Brander, James A., 1981. "Intra-industry trade in identical commodities," Journal of International Economics, Elsevier, vol. 11(1), pages 1-14, February.
    7. Richard Friberg & Mattias Ganslandt, 2008. "Reciprocal Dumping with Product Differentiation," Review of International Economics, Wiley Blackwell, vol. 16(5), pages 942-954, November.
    8. Oz Shy, 1996. "Industrial Organization: Theory and Applications," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262691795, December.
    9. Daniel M. Bernhofen, 2001. "Product differentiation, competition, and international trade," Canadian Journal of Economics, Canadian Economics Association, vol. 34(4), pages 1010-1023, November.
    10. Xavier Vives, 2001. "Oligopoly Pricing: Old Ideas and New Tools," MIT Press Books, The MIT Press, edition 1, volume 1, number 026272040x, December.
    11. Leonard Cheng, 1985. "Comparing Bertrand and Cournot Equilibria: A Geometric Approach," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 146-152, Spring.
    12. Daniel M. Bernhofen, 2001. "Product differentiation, competition, and international trade," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 34(4), pages 1010-1023, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dermot Leahy & J. Peter Neary, 2021. "When the threat is stronger than the execution: trade and welfare under oligopoly," RAND Journal of Economics, RAND Corporation, vol. 52(3), pages 471-495, September.
    2. John Gilbert & Onur A. Koska & Reza Oladi, 2022. "International trade, differentiated goods, and strategic asymmetry," Southern Economic Journal, John Wiley & Sons, vol. 88(3), pages 1178-1198, January.
    3. David R. Collie & Vo Phuong Mai Le, 2015. "Product Differentiation, the Volume of Trade and Profits under Cournot and Bertrand Duopoly," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 22(1), pages 73-86, February.
    4. Arijit Mukherjee & Uday Bhanu Sinha, 2024. "Welfare reducing licensing by an outside innovator," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 12(1), pages 17-24, June.
    5. Ganslandt, Mattias & Friberg, Richard, 2005. "Reciprocal Dumping with Bertrand Competition," CEPR Discussion Papers 5023, C.E.P.R. Discussion Papers.
    6. Krzysztof Kosiec, 2016. "Liberalisation of International Trade – The Case of Asymmetric Countries," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 8(3), pages 143-160, September.
    7. Paulo Bastos & Odd Rune Straume, 2012. "Globalization, product differentiation, and wage inequality," Canadian Journal of Economics, Canadian Economics Association, vol. 45(3), pages 857-878, August.
    8. Collie, David R., 2016. "Gains from variety? Product differentiation and the possibility of losses from trade under Cournot oligopoly with free entry," Economics Letters, Elsevier, vol. 146(C), pages 55-58.
    9. Koethenbuerger, Marko, 2011. "How do local governments decide on public policy in fiscal federalism? Tax vs. expenditure optimization," Journal of Public Economics, Elsevier, vol. 95(11), pages 1516-1522.
    10. Toru Kikuchi, 2009. "Switching Costs And The Foreign Firm'S Entry," Manchester School, University of Manchester, vol. 77(3), pages 366-372, June.
    11. Dermot Leahy & J. Peter Neary, 2013. "Oligopoly and Trade," Palgrave Macmillan Books, in: Daniel Bernhofen & Rod Falvey & David Greenaway & Udo Kreickemeier (ed.), Palgrave Handbook of International Trade, chapter 7, pages 197-235, Palgrave Macmillan.
    12. Kenji Fujiwara, 2005. "Unilateral and Multilateral Gains from Trade in International Oligopoly," The Economic Record, The Economic Society of Australia, vol. 81(255), pages 404-413, December.
    13. José Daniel Reyes, 2013. "Trade Liberalization and the Adoption of Antidumping Laws in Developing Countries," Revista Equidad y Desarrollo, Universidad de la Salle, December.
    14. Manasakis, Constantine & Vlassis, Minas, 2014. "Downstream mode of competition with upstream market power," Research in Economics, Elsevier, vol. 68(1), pages 84-93.
    15. Acharyya, Rajat & Marjit, Sugata, 1998. "To Liberalize or Not to Liberalize an LDC-Market with an Inefficient Incumbent," International Review of Economics & Finance, Elsevier, vol. 7(3), pages 277-296.
    16. Arghya Ghosh & Manipushpak Mitra, 2008. "Comparing Bertrand and Cournot Outcomes in the Presence of Public Firms," Discussion Papers 2008-18, School of Economics, The University of New South Wales.
    17. Collie, David R., 2019. "Trade Wars under Oligopoly: Who Wins and is Free Trade Sustainable?," Cardiff Economics Working Papers E2019/4, Cardiff University, Cardiff Business School, Economics Section.
    18. Roger Clarke & David Collie, 2003. "Product differentiation and the gains from trade under Bertrand duopoly," Canadian Journal of Economics, Canadian Economics Association, vol. 36(3), pages 658-673, August.
    19. Collie, David R., 2017. "A Simple Model of Brexit under Oligopoly," Cardiff Economics Working Papers E2017/17, Cardiff University, Cardiff Business School, Economics Section.
    20. Fujiwara, Kenji, 2023. "Market structure and industry location in a footloose capital model," Research in Economics, Elsevier, vol. 77(2), pages 275-283.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:reecon:v:63:y:2009:i:3:p:165-171. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622941 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.