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Information and Disclosure in Strategic Trade Policy

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  • Anthony Creane
  • Kaz Miyagiwa

Abstract

We relax the standard assumption in the strategic trade policy literature that governments possess complete information about the economy. Assuming instead that governments must obtain information from firms, we examine firms' incentive to disclose information to the governments in the Brander-Spencer setting. With quantity competition, we find firms disclosing both demand and cost information, thereby justifying the literature's omniscient-government assumption. With price competition, however, firms have no incentives to disclose demand or cost information, so governments remain uninformed. Further, with quantity competition and unknown demand, governments are caught in an informational prisoner's dilemma.

Suggested Citation

  • Anthony Creane & Kaz Miyagiwa, 2007. "Information and Disclosure in Strategic Trade Policy," ISER Discussion Paper 0705, Institute of Social and Economic Research, Osaka University.
    • Handle: RePEc:dpr:wpaper:0705
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    File URL: https://www.iser.osaka-u.ac.jp/library/dp/2007/DP0705.pdf
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    6. Okajima, Yoshitomo, 2003. "A note on 'optimal strategic trade policy under asymmetric information'," Journal of International Economics, Elsevier, vol. 61(1), pages 243-246, October.
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    9. Xavier Vives, 1990. "Trade Association Disclosure Rules, Incentives to Share Information, and Welfare," RAND Journal of Economics, The RAND Corporation, vol. 21(3), pages 409-430, Autumn.
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    Cited by:

    1. Antoniou, Fabio & Koundouri, Phoebe & Tsakiris, Nikos, 2010. "Information Disclosure Under Di§erent Modes of Regulation," MPRA Paper 122421, University Library of Munich, Germany.
    2. Fabio Antoniou & Panos Hatzipanayotou & Phoebe Koundouri, 2012. "Second Best Environmental Policies under Uncertainty," Southern Economic Journal, John Wiley & Sons, vol. 78(3), pages 1019-1040, January.
    3. Ning, Haokai, 2020. "Choice of Trade Policy with Incomplete Information," MPRA Paper 101529, University Library of Munich, Germany.
    4. Phillip McCalman & Frank Stähler & Gerald Willmann, 2019. "Contingent trade policy and economic efficiency," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 155(2), pages 227-255, May.
    5. Fabio Antoniou & Nikos Tsakiris, 2016. "On the Informational Superiority of Quantities Over Prices in the Presence of an Externality," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 65(1), pages 227-250, September.
    6. Mizuno, Tomomichi & Takauchi, Kazuhiro, 2013. "Rules of origin and uncertain cost of compliance," MPRA Paper 44431, University Library of Munich, Germany.
    7. CREANE, Anthony & MIYAGIWA, Kaz, 2015. "Exporting versus foreign direct investment: Learning through propinquity," Discussion paper series 2015-01, Hitotsubashi Institute for Advanced Study, Hitotsubashi University.
    8. Amir, Rabah & Jin, Jim Y. & Troege, Michael, 2010. "Robust results on the sharing of firm-specific information: Incentives and welfare effects," Journal of Mathematical Economics, Elsevier, vol. 46(5), pages 855-866, September.
    9. Aika Monden & Katsuyoshi Takashima & Yusuke Zennyo, 2021. "Revenue‐Sharing Contracts under Demand Uncertainty in Shopping Center," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 49(2), pages 556-573, June.
    10. Fabio Antoniou & Phoebe Koundouri & Nikos Tsakiris, 2010. "Information Sharing and Environmental Policies," IJERPH, MDPI, vol. 7(10), pages 1-18, October.
    11. Larue, Bruno & Lapan, Harvey E. & Gervais, Jean-Philippe, 2010. "Tariff-Rate Quotas, Rent-Shifting and the Selling of Domestic Access," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 11(1), pages 1-14, May.
    12. Fabio Antoniou & Nikos Tsakiris, 2014. "Information and Disclosure in Strategic Trade Policy: Revisited," Journal of Industry, Competition and Trade, Springer, vol. 14(3), pages 415-427, September.
    13. repec:jes:wpaper:y:2012:v:4:p:736-746 is not listed on IDEAS
    14. Anthony Creane & Kaz Miyagiwa, 2009. "Foreign Direct Investment and the Welfare Effects of Cost Harmonization," ISER Discussion Paper 0741, Institute of Social and Economic Research, Osaka University.
    15. Liviu-George Maha & Andreea-Nicoleta Donici & Andreea Maha, 2012. "Limits And Difficulties In Implementing The Strategic Trade Policy," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 4(4), pages 736-746, December.
    16. Sébastien Houde & Wenjun Wang, 2022. "The Incidence of the U.S.-China Solar Trade War," CER-ETH Economics working paper series 22/372, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    17. Anthony Creane & Kaz Miyagiwa, 2007. "Export, Foreign Direct Investment, and Joint Ventures: Learning the Rival's Costs through Propinquity," ISER Discussion Paper 0691, Institute of Social and Economic Research, Osaka University.
    18. Bouët, Antoine & Cassagnard, Patrice, 2013. "Strategic trade policy under asymmetric information with screening," Economic Modelling, Elsevier, vol. 32(C), pages 286-293.

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