Does competitive pressure foster innovation? In addressing this important question, prior studies ignored a distinction between discrete innovation aiming at entirely new technology and continuous improvement consisting of numerous incremental improvements and modifications made upon the...

This paper reconsiders strategic trade policy when a high-cost and a low-cost firm belonging to different countries compete a la Cournot in a third country market and technology is transferable. Assuming technology is transferred via licensing, optimal trade policy is characterized. Apart from...

In developing economies a firm's strategy is directed more often at the government than at other competing firms. As an initial step towards modeling such interactions this paper considers a situation where a government confronts a monopoly. The latter chooses price and maximizes profit and the...

Capital inflows with full repatriation give rise to welfare improvement possibilities in a small tariff-distorted economy when imperfect competition and increasing returns are allowed for in one sector of a two-sector model. This is in contrast to the Brecher-Diaz-Alejandro (1977) proposition...

We analyse the incentives and welfare implications of costly technology adoption in a two-period duopoly model where firms have different amounts of capital. We also extend our framework to an open economy set-up and examine the relationship between trade and technology adoption. Our findings...

An extended small open economy model is developed and used to examine the effect of trade on the illicit expropriation of incomes and the provision of legal services. We derive conditions under which trade liberalization will reduce expropriation activities. We also derive sufficient conditions...

We look at privatization in a general equilibrium model of a small, tariff-distorted, open economy. There is a differentiated good produced by both private and public sector enterprises. A reduction in government production in order to cut losses from such production raises the returns to...

In a two-country segmented markets model with homogeneous product Cournot oligopoly we show that production efficiency improves in the free-trade regime compared to autarky, if autarky price in each country is lower than both the post-trade prices-which holds, for example, when preferences are...