Trade Policy and Import Competition under Fluctuating Prices

Paul Strebel and Shabtai Donnenfeld

No 628, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: When subsidies and tariffs are applied to imports with fluctuating prices, it is shown that the output response of domestic producers depends on market structure and their attitude toward risk. The domestic industry response is contrasted under two types of market structure, a monopoly and a competitive industry. Some unanticipated results suggest caution in the implementation of trade policy.

Date: 1981-02
Note: ITI IFM

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