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Trade Efficiency and Trade Points: Small Versus Large Players

Laura Lu and Panos Mourdoukoutas

International Economic Journal, 1998, vol. 12, issue 2, 77-91

Abstract: The impact of Trade Points on corporate performance depends on assumptions about returns to scale, types of games played, and size of gains in demand and revenues vis-$aacute;-viscosts. Specifically: (i) in a world of profit- maximizing firms, when the contribution of Trade Points to total revenues exceeds the additional costs, Trade Points help both small firms and Large ones with the size of gains depending on the types of returns to scale and the size of demand change: and (ii) whether to connect to Trade Points depends on the type of games assumed and the size of demand gains vis-$aacute;-viscosts. [F12, D00, L13, L86]

Date: 1998
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DOI: 10.1080/10168739800000014

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