Reason. the literature in this area can be difficult to follow. This survey provides a stylized overview of the area which serves as a guide to the work. Short run effects are contrasted to long run effects. The short run effects usually studied are on pricing behavior. Long run effects are multidimensional. These include effects on quality choice and investment which often work in the opposite direction to the short run effects.

The paper studies the effects of a change in the level of voluntary export restraints (VERs) on the behavior of the domestic firm and on the welfare of the importing country. The author constructs a simple two-country Cournot duopoly model in which each firm produces a homogeneous good at constant marginal cost. It is shown that the results obtained by predecessors based on linear demand, constant-elasticity demand, strategic substitutes and so forth all emerge as special cases.