On the Effects of State Aid in the Regional Jet Aircraft Industry (Japanese)

Naoto Jinji and Yoshitaka Kawagoshi

Discussion Papers (Japanese) from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: In this study, we analyze the effects of state aid in the regional jet aircraft industry, taking the new entry of Mitsubishi Regional Jet (MRJ) by Mitsubishi Aircraft Corporation as an example. Using a simple model of imperfectly-competitive industry with a vertical relationship, we theoretically analyze the economic effects of research and development (R&D) subsidies for a new downstream entrant on an incumbent firm and domestic welfare. We show that the incumbent firm does not necessarily suffer from a loss in profits due to the new entry if it can benefit from spillovers from the new entrant through R&D in the upstream industry. Based on the theoretical results, we discuss policy implications.

Pages: 28 pages
Date: 2019-03
New Economics Papers: this item is included in nep-com
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.rieti.go.jp/jp/publications/dp/19j013.pdf (application/pdf)

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:eti:rdpsjp:19013

Access Statistics for this paper

More papers in Discussion Papers (Japanese) from Research Institute of Economy, Trade and Industry (RIETI) Contact information at EDIRC.
Bibliographic data for series maintained by TANIMOTO, Toko ().