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The New Protectionism Revisited

Richard Harris

Working Paper from Economics Department, Queen's University

Abstract: This paper reviews the strategic trade literature in oligopolistic industries beginning with the Brander-Spencer (1984) model of duopolistic international rent-shifting. Issues of long run equilibrium, entry conditions, and empirical estimates of the size of oligopolistic rents in tradeable goods industries are reviewed, and the results of simulation models are summarized. The paper also deals with issues of retaliation. It is emphasized that the prisoner's dilemma characterization of these equilibrium may be inappropriate, and managed trade may be a more plausible outcome in oligopolistic industries than strategic trade policies.

Keywords: protectionism; trade policy; game theory; oligopolies (search for similar items in EconPapers)
Date: 1989
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