Market Entry Regulation and International Competition

Thorsten Bayindir-Upmann and Frank St”hler
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Thorsten Bayindir-Upmann: University of Bielefeld
Frank St”hler: University of Kiel
Authors registered in the RePEc Author Service: Frank Stähler

No 17, Royal Economic Society Annual Conference 2002 from Royal Economic Society

Abstract: As a part of their 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.

Date: 2002-08-29
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Related works:
Journal Article: Market Entry Regulation and International Competition* (2008)
Working Paper: Market Entry Regulation and International Competition (2003)
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