Publication:
The role of commitment and the choice of trade policy instruments

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dc.affiliation.dptoUC3M. Departamento de EconomĂ­aes
dc.contributor.authorKujal, Praveen
dc.contributor.authorCosta-Cabral, CĂ©lia
dc.contributor.editorUniversidad Carlos III de Madrid. Departamento de EconomĂ­a
dc.date.accessioned2009-12-18T11:33:44Z
dc.date.available2009-12-18T11:33:44Z
dc.date.issued1999-10
dc.description.abstractThe incentives for governments to impose subsidies and tariffs on R&D and output is analyzed in a differentiated good industry where firms invest in a cost saving technology. When government commitment is credible, subsidies to R&D and output are positive both under Bertrand and Cournot competition. In the absence of government commitment the policy instrument is a tariff under Bertrand, and a subsidy under Cournot, competition. However, welfare under free trade is always greater than imposing a tariff unilaterally, or bilaterally, and hence non-committal under price competition is never an equilibrium. If a government has to choose either a subsidy on R&D (or on output) then, independent of price or quantity competition, it subsidies R&D for low levels of product substitutability and output for higherlevels of substitutability.
dc.format.mimetypeapplication/pdf
dc.identifier.issn2340-5031
dc.identifier.urihttps://hdl.handle.net/10016/6166
dc.language.isoeng
dc.relation.ispartofseriesUC3M Working papers. Economics
dc.relation.ispartofseries99-66-26
dc.rightsAtribución-NoComercial-SinDerivadas 3.0 España
dc.rights.accessRightsopen access
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.subject.ecienciaEconomĂ­a
dc.subject.otherProduct differentiation
dc.subject.otherTrade policies
dc.subject.otherCommiment
dc.subject.otherTariffs
dc.subject.otherSubsidies
dc.titleThe role of commitment and the choice of trade policy instruments
dc.typeworking paper*
dspace.entity.typePublication
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