OPTIMUM-WELFARE AND MAXIMUM-REVENUE TARIFFS IN MIXED OLIGOPOLY WITH FOREIGN COMPETITORS
This paper re-examines the important tariff ranking issue under a linear mixed oligopoly model with foreign competitors and asymmetric costs. We demonstrate that under Cournot competition, when the size of domestic private and foreign private firms become more unequally distributed, optimum-welfare tariff will exceed maximum-revenue tariff. We also show that under Stackelberg competition, when the domestic government protects its domestic sector, it will levy higher optimum-welfare tariffs versus maximum-revenue tariffs; however, when it decides to open its doors more for foreign competitors, it will need to levy higher maximum-revenue tariffs versus optimum-welfare tariffs. The above results remain valid whether the domestic public firm acts as a leader or a follower. Copyright 2010 The Authors. Journal compilation 2010 Blackwell Publishing Ltd/University of Adelaide and Flinders University.
Year of publication: |
2010
|
---|---|
Authors: | WANG, LEONARD F.S. ; WANG, JEAN ; LEE, JEN-YAO |
Published in: |
Australian Economic Papers. - Wiley Blackwell. - Vol. 49.2010, 1, p. 60-72
|
Publisher: |
Wiley Blackwell |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Optimum-welfare and maximum-revenue tariffs in mixed oligopoly with foreign competitors
Wang, Leonard F. S., (2010)
-
Tariffs ranking in mixed oligopoly with revenue constraint
Wang, Leonard F. S., (2011)
-
Tariffs ranking in mixed oligopoly with revenue constraint
Wang, Leonard F. S., (2011)
- More ...