Trade and Imperfect Competition in General Equilibrium

Onur Koska and Frank Stähler

No 3543, CESifo Working Paper Series from CESifo

Abstract: This paper employs a general equilibrium model of imperfect competition and trade in which capital is used to establish firms and labor is used for production. We show that two different types of equilibria may exist, one with factor price equalization and one with different factor prices. When factor prices are equalized, trade improves welfare under relatively mild conditions. However, if factor prices differ, these conditions are not sufficient for mutual gains from trade.

Keywords: imperfect competition; international trade; general equilibrium (search for similar items in EconPapers)
JEL-codes: D50 F12 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (4)

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Journal Article: Trade and imperfect competition in general equilibrium (2014)
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