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Optimal Privatisation and Trade Policies with Endogenous Market Structure
Author(s) -
Cato Susumu,
Matsumura Toshihiro
Publication year - 2015
Publication title -
economic record
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.365
H-Index - 42
eISSN - 1475-4932
pISSN - 0013-0249
DOI - 10.1111/1475-4932.12189
Subject(s) - tariff , oligopoly , short run , economics , commercial policy , international economics , microeconomics , monetary economics , international trade , cournot competition
This study investigates the short‐run and long‐run relationships of trade and privatisation policies. In both the short run and the long run, the optimal degree of privatisation is increasing in the import tariff rate. The optimal tariff rate is strictly positive in the short run but can be non‐positive in the long run. Thus, the long‐run analysis yields contrasting implications on trade policy in mixed oligopolies.