We examine conditions under which a low cost vertically integrated manufacturer has an incentive to export an intermediate product to its higher cost (vertically integrated) rival rather than to vertically foreclose, fully cutting off supplies. The nature of supply conditions in the importing country, the size of an import tariff on the final good and optimal policy by the exporting country are all shown to be important for this decision. The exporting country may gain by taxing exports of the final (Cournot) product even though, under Cournot competition, an export subsidy is optimal in the absence of a market for intermediates. In this case, optimal policy also requires an export tax on intermediates, but the higher tax on final goods serves to divert sales to the more profitable market for intermediates increasing the extent of vertical supply. It is optimal to tax the export of both goods or to subsidize the export of both goods. It is never optimal to tax one and subsidize the other.

The most important book on antitrust ever written. It shows how antitrust suits adversely affect the consumer by encouraging a costly form of protection for inefficient and uncompetitive small businesses.

This book presents a representative collection of papers on international trade, one of the most dynamic sub-fields in economics. The contributions range over all the major areas of research, including articles on the geographical aspects of international trade by Paul Krugman and Alan Deardorff, on dynamic stochastic economies by Avinash Dixit, and on endogenous growth by Gene Grossman and Elhanan Helpman. In addition to the theoretical contributions, the book also contains work on important policy issues such as auction quotas, discussed by Kala Krishna, and the role of government in economic development, by Anne Krueger. Also included is an assessment by Bill Ethier of the theoretical achievements of a leading authority in international trade theory, Ronald Jones, in whose honour the essays were written.

Trade, Policy, and International Adjustments covers the theoretical issues, macroeconomics, and mathematical methods in the field of international economics. The book summarizes and illustrates the various contributions to the field of international economics. The text presents studies on the issues in international trade and commercial policies; voluntary export restrictions; application of a geometric technique to a multidimensional problem concerning the Stolper-Samuelson theorem; the symmetry theorem between tariffs and quotas in the context of a monetary economy under flexible exchange rates; and application of the Hopf bifurcation theory to the theory of international capital mobility. Economists, teachers, and students of economics will find the book very insightful.

New theories of international trade suggest that pro- tectionism can make sense. This finding depends on the in- troduction of market power and increasing returns to scale into the international trade theory. The enormous political implications of this hypothesis have started a large interest in applied or empirical investigations of this issue. However, econometric work in international trade is comparatively scarce, especially if it comes to testing with individual data. Therefore, this volume is considered to be a contribution to fill that gap. The volume consists of three parts: First, issues in strategic trade are discussed by means of a survey on recent contributions of the literatureand by a simulation excercise on optimal trade policy for imperfectly competitive industries. Second, a part investigating the determinants of trade flows studies the interrelationships between trade balances and exchange rates, plant size and international trade, and the revelance offirm size and market concentration for the degree of export market integration using business survey firm data. Third, there are studies on imperfect markets, innovations and learning which demonstrate the importanceof imperfect competition for international economics. All contributions provide empirical evidence for the revelance of the newly developed trade theories and demonstrate useful quantitative techniques for their investigation.

This book analyses the vertical relationships of firms in an international context. These relationships, Khalid Sekkat argues, have gained further relevance due to the notable increase in vertical specialization of production across borders in the past few years.

This book discusses the developments in trade theories, including new-new trade models that account for firm level trade flows, trade growth accounting using inverse gravity models (including distortions in gravity models), the impact of trade liberalization under the aegis of regional and multilateral liberalization efforts of economies using partial and general equilibrium analysis, methodologies of constructing ad valorem equivalents of non-tariff barriers, volatility spillover effects of financial and exchange rate markets. The main purpose of the book is to guide researchers working in the area of international trade, especially focused on empirical analysis of trade policy issues by updating their knowledge on issues related to trade theory, empirical methods, and their applications. The book would prove useful for policy makers, academicians, and researchers.