Strategic export decisions in international trade

Kazuhiro Takauchi, Tomomichi Mizuno and Katsufumi Fukuda ()
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Katsufumi Fukuda: School of Global Studies, Chukyo University Graduate School of Economics, Kobe University

No 2401, Discussion Papers from Graduate School of Economics, Kobe University

Abstract: As it is well known that export markets are often oligopolistic, we build an oligopoly trade model in which firms choose whether or not to export. We focus on the different roles of transport and fixed export costs with respect to the export decision, and show that depending on the sizes of both transport and fixed export costs, all possible trade patterns appear between two symmetric countries. If the transport cost is large because firms behave in different ways, "One-way trade" appears. If the fixed export cost is large because firms adopt the same behavior, situations of "No trade" and "Two-way trade" could occur.

Pages: 35 pages
Date: 2024-02
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http://www.econ.kobe-u.ac.jp/RePEc/koe/wpaper/2024/2401.pdf (application/pdf)

Related works:
Working Paper: Strategic Export Decisions in International Trade (2024)
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