Habit formation and strategic interactions: A new gain from trade?

Antoine Vatan

Economics Letters, 2013, vol. 121, issue 1, 101-104

Abstract: A two-period duopoly model of trade with habit formation displays a “pre-entry pro-competitive effect” and the standard pro-competitive effect once trade is effective. Both effects are driven in a different way by transport cost. A trade liberalization affects ambiguously welfare.

Keywords: Habit formation; Strategic interactions; Gains from trade (search for similar items in EconPapers)
JEL-codes: F1 F12 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:121:y:2013:i:1:p:101-104

DOI: 10.1016/j.econlet.2013.07.011

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