Trade Warfare: Tariffs and Cartels / James A. Brander, Barbara J. Spencer.

Format:

Book

Author/Creator:

Brander, James A.

Contributor:

National Bureau of Economic Research.

Spencer, Barbara J.

Series:

Working Paper Series (National Bureau of Economic Research) no. w1193.

NBER working paper series no. w1193

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Trade Warfare

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1983.

Summary:

National governments have incentives to intervene in international markets, particularly in encouraging export cartels and in imposing tariffs on imports from imperfectly competitive foreign firms. Although the optimal response to foreign monopoly is usually a tariff, a specific subsidy will be optimal if demand is very convex, as with constant elasticity demand. If ad valorem tariffs or subsidies are considered, a subsidy is optimal if the elasticity of demand increases as consumption increases.The critical conditions in both ad valorern and specific cases hold generally for Cournot ologopoly. Noncooperative international policy equilibrium will be characterized by export cartels and rent-extracting tariffs.

Notes:

Print version record

August 1983.