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Multiproduct oligopoly and trade between asymmetric countries
Author(s) -
Cheng YiLing,
Tabuchi Takatoshi
Publication year - 2018
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/roie.12311
Subject(s) - oligopoly , economics , product (mathematics) , microeconomics , liberalization , range (aeronautics) , free trade , international economics , product differentiation , international trade , industrial organization , cournot competition , market economy , mathematics , materials science , geometry , composite material
This paper develops a general equilibrium model of oligopolistic multiproduct firms conducting trade between asymmetric countries, in which heterogeneous entrants choose their product ranges and outputs. We show that there are fewer exporters in the larger country, and each produces a wider range of products but exports fewer varieties. We also show that while trade liberalization increases the total number of consumed varieties, it decreases the total number of firms and may reduce the product range of each firm.