Quotas Under Dynamic Bertrand Competition

Miyagiwa Kaz () and Yuka Ohno
Additional contact information
Miyagiwa Kaz: Emory University

A chapter in International Trade and Economic Dynamics, 2009, pp 239-255 from Springer

Abstract: We present a new model of dynamic Bertrand competition, where a quota is treated as an intertemporal constraint, rather than as a capacity constraint. The firm under a quota then can still vary the rates of exports over time, provided that its annual sales do not exceed the quota. We show that a quota results in higher prices than a tariff of equal imports. We also find that firms never play mixed strategies in equilibrium, which contrasts from the result of a one-shot game, in which the only equilibrium under a quota is in mixed strategies (Krishna 1989).

Keywords: Nash Equilibrium; Free Trade; Mixed Strategy; Capacity Constraint; Pure Strategy (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: Quotas under Dynamic Bertrand Competition (2008)
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:spr:sprchp:978-3-540-78676-4_19

Ordering information: This item can be ordered from
http://www.springer.com/9783540786764

DOI: 10.1007/978-3-540-78676-4_19

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().