We analyse a simple ‘tariffs-cum-foreign competition’ policy targeted at enhancing the competitive position of a domestic, developing country firm that competes with its developed country counterpart on the domestic market and that carries out innovative (imitative) effort. We evaluate this...

In this paper we discuss the incentives of a welfare maximizing government to implement strategic trade policy when, on the one hand, there is uncertainty about the relevant market information (like the type of competition, demand function, cost function, etc.), but, on the other hand, the...