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To the surprise of many, price deviations between markets characterized by imperfect competition have often been little affected by lower transport costs. In a Cournot model we show that if firms' decisions to segment markets are endogenous, then lower transport costs are, in many cases,...
Persistent link: https://www.econbiz.de/10001622434
While many studies have documented deviations from the Law of One Price in international settings, evidence is scarce on the extent to which consumers take advantage of price differentials and engage in cross border shopping. We use data from 287 Swedish municipalities to estimate how responsive...
Persistent link: https://www.econbiz.de/10002609537
This paper examines if international trade can reduce total welfare in an international oligopoly with differentiated goods. We show that welfare is a U-shaped function in the transport cost as long as trade occurs in equilibrium. With a Cournot duopoly trade can reduce welfare compared to...
Persistent link: https://www.econbiz.de/10002679500
This paper analyses the effects of non-tariff barriers, in terms of both variable and fixed export costs, on trade … emerges, only variable, but not fixed export costs, influence the trade structure. The empirical results suggest that non …-tariff barriers act, in particular, as fixed export costs, as the trade and intra-industry trade emerge in a larger number of …
Persistent link: https://www.econbiz.de/10001600083
This paper attempts to make an innovative contribution to the growth literature by proposing a trade-induced catch up model in which imitation benefit is explicitly modelled and trade knowledge spillover is considered. The resulting income dynamics is in the error correction form. The Pooled...
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