Cost effectiveness of R&D and the robustness of strategic trade policy

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dc.contributor.author Kujal, Praveen
dc.contributor.author Ruiz, Juan
dc.date.accessioned 2006-11-09T11:18:59Z
dc.date.available 2006-11-09T11:18:59Z
dc.date.issued 2003-01
dc.identifier.issn 2340-5031
dc.identifier.uri http://hdl.handle.net/10016/282
dc.description.abstract This paper analyzes the incentives for governments to impose export subsidies when firms invest in a cost saving technology before market competition. Governments first impose an export subsidy or a tax. After observing export policy, firms invest in cost reducing R and D and subsequently compete in the market. Governments subsidize exports under Cournot competition. Under Bertrand competition, export subsidies are positive whenever R and D is sufficiently costeffective at reducing marginal costs, and negative otherwise. The trade policy reversal found in models without endogenous sunk costs disappears if R and D is sufficiently cost-effective. Output subsidies are more robust than implied by the recent literature.
dc.format.extent 2507661 bytes
dc.format.mimetype application/pdf
dc.language.iso eng
dc.language.iso eng
dc.relation.ispartofseries UC3M Working Paper. Economics
dc.relation.ispartofseries 2003-01
dc.rights Atribución-NoComercial-SinDerivadas 3.0 España
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.title Cost effectiveness of R&D and the robustness of strategic trade policy
dc.type workingPaper
dc.subject.eciencia Economía
dc.rights.accessRights openAccess
dc.identifier.repec we030401
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