The Effects of a Content Requirement on a Foreign Duopsonist

Martin Richardson

Chapter 1 in Dimensions of Trade Policy, 2017, pp 3-17 from World Scientific Publishing Co. Pte. Ltd.

Abstract: This chapter considers the operation of a local content requirement in a duopsony between domestic and foreign firms and demonstrates its consequences for the domestic producer of a final good. It is shown that content protection may have perverse effects on a foreign firm’s profits and may be welfare-improving overall, shifting profits from the domestic firm to both the foreign firm and domestic input producers.

Keywords: Trade Policy; Preferential Trading Agreements; Content Protection; Parallel Imports (search for similar items in EconPapers)
JEL-codes: F13 (search for similar items in EconPapers)
Date: 2017
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