EconPapers    
Economics at your fingertips  
 

Offshoring Quotas and Strategic Export Subsidies

Subhayu Bandyopadhyay () and Koushik Ghosh

Emerging Markets Finance and Trade, 2018, vol. 54, issue 7, 1578-1585

Abstract: We present an analysis of strategic export subsidization in the presence of exogenous limits on the extent of offshoring that is permissible for a domestic firm. Rather than offsetting a quota’s cost-raising effect, the government reduces its optimal strategic subsidy compounding the negative effects on the domestic firm’s market share. This double jeopardy of lower subsidies and greater offshoring restrictions must reduce domestic profits as well as domestic welfare. Finally, we show that there is no guarantee that such an offshoring quota will raise domestic employment in the oligopolistic sector, calling into question the efficacy of such a barrier.

Date: 2018
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://hdl.handle.net/10.1080/1540496X.2017.1310100 (text/html)
Access to full text is restricted to subscribers.

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:mes:emfitr:v:54:y:2018:i:7:p:1578-1585

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/MREE20

Access Statistics for this article

More articles in Emerging Markets Finance and Trade from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().

 
Page updated 2019-09-13
Handle: RePEc:mes:emfitr:v:54:y:2018:i:7:p:1578-1585