Premium
Tariff (De‐) Escalation with Successive Oligopoly
Author(s) -
McCorriston Steve,
Sheldon Ian
Publication year - 2011
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/j.1467-9361.2011.00629.x
Subject(s) - oligopoly , tariff , economics , upstream (networking) , differential (mechanical device) , downstream (manufacturing) , international economics , microeconomics , vertical integration , industrial organization , cournot competition , operations management , computer science , computer network , engineering , aerospace engineering
This paper explores the issue of a simultaneous reduction in tariffs at different stages of a vertically related market where each stage is oligopolistic. When vertically related markets are characterized as a successive oligopoly, reducing tariffs by an equivalent amount on upstream and downstream imports will have a differential effect on market access and hence profits at each stage as a result of a combination of horizontal and vertical effects. These differential effects have implications for the tariff structure post‐trade reform.