Information and Disclosure in Strategic Trade Policy: Revisited

Fabio Antoniou and Nikos Tsakiris ()

Journal of Industry, Competition and Trade, 2014, vol. 14, issue 3, 415-427

Abstract: In a recent paper, Creane and Miyagiwa (J Int Econ 75:229–244, 2008 ) show that the mode of competition determines whether information sharing occurs between firms and governments within an international duopoly context in which the firms are located in different countries. In this paper, we show that when a price instrument is implemented to control exports, then the relative number of firms located in each country is also critical. In particular, we illustrate that with quantity competition and under the presence of demand and cost uncertainty, information sharing does not occur when the number of firms in one country is higher than the number of firms in the other country and vice-versa. However, when direct quantity controls are implemented the number of firms is irrelevant and information sharing always occurs. Moreover, we show that the informational prisoner’s dilemma restricts only to the case where subsidies are implemented in both countries when the number of firms across countries is equal. Copyright Springer Science+Business Media New York 2014

Keywords: Information; Uncertainty; Strategic trade; Multiple firms; F12; F18; Q58 (search for similar items in EconPapers)
Date: 2014
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Working Paper: Information and disclosure in strategic trade policy: Revisited (2011)
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DOI: 10.1007/s10842-013-0163-z

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