A MONOPOLY REASON WHY AUTARKY MIGHT BE BEST FOR A LARGE COUNTRY*

Yochanan Shachmurove and Uriel Spiegel

Manchester School, 2005, vol. 73, issue 3, 269-280

Abstract: Will all countries gain from free trade? Two countries, one with a large and the other a small population, are modeled. Once trade is opened, real income rises in the small country and falls in the large one. The intuition is that, without trade, the large country's local monopoly makes profits at the expense of its consumers. With trade, the foreign duopolist earns some of the profits, even though the industry profits are smaller. Average home consumption falls, even though all the home citizens, except the producer, benefit. This can explain the objections to the lifting of economic barriers.

Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://doi.org/10.1111/j.1467-9957.2005.00446.x

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:manchs:v:73:y:2005:i:3:p:269-280

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1463-6786

Access Statistics for this article

Manchester School is currently edited by Keith Blackburn

More articles in Manchester School from University of Manchester Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().