Market Entry Regulation and International Competition

Thorsten Upmann and Frank Stähler

No 979, CESifo Working Paper Series from CESifo

Abstract: As a part of their industry or competition policies governments decide whether to allow for free market entry of firms or to regulate market access. We analyze a model where governments (ab)use these policy decisions for strategic reasons in an international setting. Multiple equilibria of this game emerge; and if the cost difference between domestic and foreign firms is ‘significant‘, all equilibria induce the same allocation, where production exclusively takes place in the cost-efficient country. Moreover, these equilibria are Pareto efficient if this cost difference is ‘substantial‘. Only if cost differences are ‘insignificant‘, may production take place in both countries in equilibrium.

Keywords: intergovernmental competition; competition policy; entry regulation; free market entry; international trade (search for similar items in EconPapers)
JEL-codes: D43 F12 L11 L51 (search for similar items in EconPapers)
Date: 2003
New Economics Papers: this item is included in nep-com, nep-mic and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Market Entry Regulation and International Competition* (2008)
Working Paper: Market Entry Regulation and International Competition (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_979

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