Electronic Resource
Oxford, UK and Boston, USA
:
Blackwell Publishers Ltd.
Review of international economics
7 (1999), S. 0
ISSN:
1467-9396
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Economics
Notes:
Optimal entry policy is considered in markets served by both domestic and foreign firms. Compared with the prior entry literature, introducing foreign producers as market participants reduces incentives for entry deterrence and enhances incentives for entry subsidization. Incentives are changed because entry produces “terms-of-trade” gains. The optimal entry subsidy is analyzed under complete and incomplete information regarding the entrant’s costs. Incomplete cost information creates differences in the optimal subsidy for domestic and foreign entrants, with foreign entrants relatively less subsidized. Domestic entrants with low marginal costs are oversubsidized and those with high marginal costs are undersubsidized.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/1467-9396.00195
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