Competition for firms in an oligopolistic industry: the impact of economic integration

A. Haufler; I. Wooton

doi:10.1016/j.jinteco.2009.10.002

Competition for firms in an oligopolistic industry: the impact of economic integration

A. Haufler, I. Wooton

Research output: Contribution to journal › Article

33 Citations (Scopus)

Abstract

We set up a model of generalised oligopoly where two countries of different size compete for an exogenous, but variable, number of identical firms. The model combines a desire by national governments to attract internationally mobile firms with the existence of location rents that arise even in a symmetric equilibrium where firms are dispersed. As economic integration proceeds, equilibrium taxes initially decline, but then rise again as trade costs fall even further. A range of trade costs is identified where economic integration raises the welfare of the small country, but lowers welfare in the large country.

Language	English
Pages	239-248
Number of pages	10
Journal	Journal of International Economics
Volume	80
Issue number	2
DOIs	10.1016/j.jinteco.2009.10.002
Publication status	Published - Mar 2010

Fingerprint

Economic integration

Industry

Trade costs

Small countries

Government

Exogenous variables

Rent

Oligopoly

Tax

Keywords

tax competition
subsidy competition
oligopolistic markets
economic integration

Cite this

Haufler, A., & Wooton, I. (2010). Competition for firms in an oligopolistic industry: the impact of economic integration. Journal of International Economics, 80(2), 239-248. https://doi.org/10.1016/j.jinteco.2009.10.002

Haufler, A. ; Wooton, I. / Competition for firms in an oligopolistic industry : the impact of economic integration. In: Journal of International Economics. 2010 ; Vol. 80, No. 2. pp. 239-248.

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Haufler, A & Wooton, I 2010, 'Competition for firms in an oligopolistic industry: the impact of economic integration' Journal of International Economics, vol. 80, no. 2, pp. 239-248. https://doi.org/10.1016/j.jinteco.2009.10.002

Competition for firms in an oligopolistic industry : the impact of economic integration. / Haufler, A.; Wooton, I.

In: Journal of International Economics, Vol. 80, No. 2, 03.2010, p. 239-248.

Research output: Contribution to journal › Article

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