Trade policies, imperfect competition, and endogenous growth
Article Abstract:
Two types of imperfect competition models, where an equilibrium situation involving two countries is assumed, are analyzed according to their ability to increase the welfare of either or both countries. Trade activity in the monopolistic competition model is considered as beneficial to welfare and induces internal growth while the same activity in the model of Cournot competition produces a qualified effect that is reliant on the manner firms enter or leave the industry.
Publication Name: De Economist
Subject: Economics
ISSN: 0013-063X
Year: 1995
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Trade policies and imperfect competition: a note
Article Abstract:
The answer provided by the Westerhout model of imperfect competition in trade does not represent an equilibrium. Westerhout concluded that trade reduces welfare in cases where the number of producers are fixed and there is a semblance of oligopolistic competition. However, if the producers are allowed to take advantage of profit opportunities, the model approximates the monopolistic competition model proposed by Krugman.
Publication Name: De Economist
Subject: Economics
ISSN: 0013-063X
Year: 1995
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Trade policies and imperfect competition: reply
Article Abstract:
Jan Willem Gunning's criticism of the Westerhout model due to its similarities with Krugman's monopolistic competition model is partially incorrect. Exclusion of restrictions will result to a market that allows goods produced by monopolists and goods made under conditions set by the Cournot competition model. If said restrictions are included in the study, the model's symmetry is eliminated.
Publication Name: De Economist
Subject: Economics
ISSN: 0013-063X
Year: 1995
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