International Tariffs in a Mixed Oligopoly with Research Spillovers

2016 ◽  
Vol 22 (3) ◽  
pp. 277-293
Author(s):  
Shoji Haruna ◽  
Rajeev K. Goel
Keyword(s):  
Industrial Organization ◽  
Research And Development ◽  
Technical Change ◽  
Large Range ◽  
Policy Implications ◽  
Mixed Oligopoly ◽  
Private Firms ◽  
Second Stage ◽  
Public Firm ◽  
Mixed Oligopolies

AbstractThis paper merges three strands of the literature – industrial organization, international trade, and economics of technical change – to examine the effect of tariffs on international mixed oligopolies which conduct research and development (R&D) that is prone to spillovers. Mixed oligopolies are prevalent in the defense sector, among other sectors. Using a two-stage sequential game with R&D in the first stage and production in the second stage, results show that higher tariffs reduce outputs of both the domestic public firm and foreign private firms, and private R&D. Effects on domestic R&D and welfare, and profits of foreign private firms depend upon spillovers. Within a large range of research spillovers, higher tariffs can in fact lower welfare. Some of these findings are different from traditional oligopolies and from models that ignore research spillovers. Policy implications are discussed.

scholarly journals The Evaluation of Maximum Tariffs in an Emerging Economy: The Nigerian Case

2012 ◽  
Vol 2 (3) ◽  
pp. 207
Author(s):  
N. P. Audu ◽  
T. O. Apere
Keyword(s):  
Emerging Economy ◽  
Mixed Oligopoly ◽  
Private Firms ◽  
Oligopolistic Competition ◽  
Oligopoly Model ◽  
Public Firm ◽  
Asymmetric Costs ◽  
Nigerian Government ◽  
Foreign Competitors

Using the Cournot and Stackelberg theories of oligopolistic competition, the paper re-evaluate the importance of tariff ranking issue under a mixed oligopoly model with foreign competitors and asymmetric costs. We demonstrated that under Cournot theory, when the size of domestic private and foreign private firms becomes more unequally distributed, maximum–welfare tariff will exceed maximum–revenue tariff. The study also revealed that under Stackelberg theory, when the domestic government protects its domestic sector, it will levy higher maximum–welfare tariffs versus maximum–revenue tariffs. These two positions notwithstanding, when the Nigerian government decides to open its doors more for foreign competitors, it will need to levy higher maximum-revenue tariffs versus maximum–welfare tariffs. The findings of this paper remain valid whether the domestic public firm acts as a leader or a follower in the market.

Optimal Privatisation Policy under Private Leadership in Mixed Oligopolies

2018 ◽  
Vol 17 (1) ◽  
pp. 1-14
Author(s):  
Ming Hsin Lin ◽  
Toshihiro Matsumura
Keyword(s):  
Marginal Cost ◽  
Private Firms ◽  
Cost Difference ◽  
Public And Private ◽  
Optimal Degree ◽  
Public Firm ◽  
The Cost ◽  
Mixed Oligopolies ◽  
Simultaneous Move

We discuss optimal privatisation policies in mixed oligopolies in which a public firm is the Stackelberg follower (private leadership). We find that under constant marginal cost, the optimal degree of privatisation is zero. When the marginal cost is increasing, however, the optimal degree is never zero, and full privatisation can be optimal. These results suggest that the optimal privatisation policy depends on the cost conditions. We also find that the optimal degree of privatisation is substantially lower under private leadership than in the simultaneous-move model when there is no cost difference between public and private firms.

THE RELATIVE-PROFIT-MAXIMIZATION OBJECTIVE OF PRIVATE FIRMS AND ENDOGENOUS TIMING IN A MIXED OLIGOPOLY

2011 ◽  
Vol 56 (02) ◽  
pp. 203-213 ◽  
Author(s):  
YUANZHU LU
Keyword(s):  
Social Welfare ◽  
Profit Maximization ◽  
Mixed Oligopoly ◽  
Endogenous Timing ◽  
Private Firms ◽  
The Public ◽  
Marginal Costs ◽  
Public Firm ◽  
The Absolute ◽  
Relative Profit

This paper investigates whether the relative-profit-maximization objective of private firms affects endogenous timing in a mixed oligopoly in the linear demand case. Assuming firms have constant marginal costs and symmetric private firms are more efficient than the public firm, it is found that such an objective does not affect endogenous timing compared with the absolute-profit-maximization case. When the equilibrium involves the public firm acting as a leader, social welfare increases compared with the level in the absolute-profit-maximization case. When the equilibrium involves the public firm acting as a follower, social welfare remains unchanged.

Existence of Unique Equilibrium in Cournot Mixed Oligopoly

2018 ◽  
Vol 20 (03) ◽  
pp. 1750035
Author(s):  
Koji Okuguchi ◽  
Takeshi Yamazaki
Keyword(s):  
Nash Equilibrium ◽  
General Model ◽  
Demand Function ◽  
Mixed Oligopoly ◽  
Private Firms ◽  
Market Demand ◽  
Unique Equilibrium ◽  
Quadratic Cost ◽  
Public Firm ◽  
Unique Nash Equilibrium

The properties of Cournot mixed oligopoly consisting of one public firm and one or more than one private firms have mostly been analyzed for simple cases on the basis of numerical calculations of the equilibrium values for a linear market demand function and linear or quadratic cost functions. In this paper, after proving the existence of a unique equilibrium in Cournot mixed oligopoly under general conditions on the market demand and each firm’s cost function, we derive conditions ensuring the existence of a unique Nash equilibrium for the mixed oligopoly where one public firm and at least one of the private firms are active in a general model of Cournot mixed oligopoly with one public firm and several private firms.

Growth Strategies to Avoid the Middle-Income Trap

2020 ◽  
pp. 24-47
Author(s):  
Homi Kharas ◽  
Indermit Gill
Keyword(s):  
Low Income ◽  
Technical Change ◽  
Policy Implications ◽  
Low Income Countries ◽  
Growth Strategies ◽  
Functional Theory ◽  
Middle Income ◽  
Advanced Economies ◽  
The Subject ◽  
Middle Income Trap

Since the authors of this chapter coined the term in 2006, “the middle-income trap” has been the subject of scores of investigations. The evidence in support of its existence has been mixed, but their original proposition was that of the possibility of a trap, not its inevitability. In this chapter, they emphasize the absence of a functional theory of economic growth in middle-income economies. Solow–Swan models did well to explain growth in low-income countries, and Lucas–Romer models emphasizing endogenous technical change identified the main drivers of growth in advanced economies. Neither class of models has, however, satisfactorily explained successful transitions from one type of growth to the other. The authors suggest that Schumpeterian models proposed by Aghion, Howitt, and others that stress creative destruction and institutional change provide the analytical foundations for a better understanding of growth in middle-income economies. They present evidence that is consistent with the predictions of this approach, and discuss its policy implications.

scholarly journals Technical Inefficiency Effects in Agriculture—A Meta-Regression

2016 ◽  
Vol 8 (2) ◽  
pp. 109 ◽  
Author(s):  
Justice G. Djokoto ◽  
Francis Y. Srofenyo ◽  
Akua A. Afrane Arthur
Keyword(s):  
Policy Implications ◽  
Quantitative Review ◽  
Technical Inefficiency ◽  
Second Stage ◽  
Statistical Inferences ◽  
Vote Count ◽  
Study Characteristics ◽  
Key Variables ◽  
Meta Regression ◽  
Using Data

<p>A number of studies have examined the effect of study characteristics on mean technical efficiency as the dependent variable. This article departs from these earlier studies by using second-stage inefficiency covariates as key exploratory variables and study characteristics as control variables in a meta-regression. Unlike the vote count method of quantitative review, the parameters of the key variables have desirable properties and enable statistical inferences to be drawn. Additionally, the dependent variable employed is mean technical inefficiency. This is demonstrated using data on technical inefficiency of primary studies in Ghanaian agriculture, fitted to fractional regression models. The appropriate functional form of the fractional regression model is discussed with policy implications.</p>

Induced Technical Change in Energy and Environmental Modeling: Analytic Approaches and Policy Implications

2002 ◽  
Vol 27 (1) ◽  
pp. 271-308 ◽  
Author(s):  
Michael Grubb ◽  
Jonathan Köhler ◽  
Dennis Anderson
Keyword(s):  
Climate Change ◽  
Technical Change ◽  
Energy Sector ◽  
Learning By Doing ◽  
Environmental Modeling ◽  
Policy Implications ◽  
Marginal Costs ◽  
Technological Diversity ◽  
Energy Economy ◽  
Induced Technical Change

▪ Abstract  Technical change in the energy sector is central for addressing long-term environmental issues, including climate change. Most models of energy, economy, and the environment (E3 models) use exogenous assumptions for this. This is an important weakness. We show that there is strong evidence that technical change in the energy sector is to an important degree induced by market circumstances and expectations and, by implication, by environmental policies such as CO2 abatement. We classify the main approaches to modeling such induced technical change and review results with particular reference to climate change. Among models with learning by doing, weak responses are only obtained from models that are highly aggregated (lack technological diversity) and/or that equate rates of return to innovation across sectors. Induced technical change broadens the scope of efficient policies toward mitigation, including not just research and development and aggregated market instruments but a range of sectoral-based policies potentially at divergent marginal costs. Furthermore, to the extent that cleaner technologies induced by mitigation diffuse globally, a positive spillover will result that will tend to offset the substitution-based negative spillover usually hypothesized to result from the migration of polluting industries. Initial explorations suggest that this effect could also be very large.

Hospital mergers, acquisitions and regulatory policy implications

2019 ◽  
Vol 45 (10/11) ◽  
pp. 1354-1362
Author(s):  
Bhavneet Walia ◽  
Christopher John Boudreaux
Keyword(s):  
Health Care ◽  
Industrial Organization ◽  
Organization Theory ◽  
Care Delivery ◽  
Regulatory Policy ◽  
Policy Implications ◽  
Power Cost ◽  
Hospital Mergers ◽  
Content Type ◽  
Industrial Organization Theory

Purpose The purpose of this paper is to review the literature on hospital mergers and acquisitions (M&As). Design/methodology/approach The authors conduct a systematic review of the literature on hospital M&As to summarize their effects upon cost of health care delivery (access), efficiency, market power, cost and price. Implications for health care industry policy are provided. Findings A significant majority of results conclude lower costs, increased efficiency, but higher prices (due to a market concentration effect) following hospital merger or acquisition. These results are consistent with industrial organization theory and suggest that regulatory policy (e.g. price cap regulation) will raise allocative efficiency, consumer surplus and overall market surplus within markets for hospital services. Originality/value This is the first study to review the price, cost and efficiency effects of M&As with respect to industrial organization theory in the context of hospitals. This study also provides regulatory policy implications.

THE IMPORTANCE OF INTERNAL KNOWLEDGE GENERATION AND EXTERNAL KNOWLEDGE SOURCING FOR SME INNOVATION AND PERFORMANCE: EVIDENCE FROM IRELAND

2019 ◽  
Vol 23 (07) ◽  
pp. 1950069
Author(s):  
JUSTIN DORAN ◽  
NOIRIN McCARTHY ◽  
MARIE O’CONNOR
Keyword(s):  
Research And Development ◽  
Product Innovation ◽  
Process Innovation ◽  
Policy Implications ◽  
Knowledge Generation ◽  
Knowledge Sources ◽  
Knowledge Sourcing ◽  
External Knowledge ◽  
And Performance ◽  
The Impact

This paper analyses the knowledge sourcing, transformation, and exploitation stages of the innovation value chain for a sample of Irish small to medium sized enterprises (SMEs) using Community Innovation Survey data. It explores the role of internal research and development (R&D) and external knowledge on SMEs’ innovation and performance. The open innovation paradigm, which stresses the importance of external linkages, is used to examine the impact of different external knowledge sources on SMEs’ innovation. The consideration of external linkages in the innovation performance of SMEs is crucial as these firms may be constrained in their ability to perform R&D due to their size. The analysis expands the traditional CDM methodology beyond the consideration of research and development as the sole source of knowledge for innovation by also considering a range of potential external knowledge sources. The findings indicate that SMEs generate knowledge internally through the performance of R&D, while also exploiting linkages to external agents. However, the impact of external sources of knowledge is not uniform. The results suggest that backward linkages have a positive impact on SME product innovation, but negatively affect SME process innovation, while public knowledge sources are positively related to the probability of product innovation occurring. This may have important policy implications. Finally, process innovation is also found to be a key determinant of SME productivity, while product innovation has no impact on SME performance.

scholarly journals Corporate R&D intensity decomposition: different data, different results?

2020 ◽  
Author(s):  
Pietro Moncada-Paternò-Castello ◽  
Sara Amoroso ◽  
Michele Cincera
Keyword(s):  
Research And Development ◽  
Analytical Methods ◽  
Innovation Policy ◽  
International Comparisons ◽  
Policy Implications ◽  
Data Sources ◽  
Empirical Results ◽  
Research And Innovation ◽  
Research And Innovation Policy ◽  
First Time

Abstract Research and Development (R&D) indicators are used to facilitate international comparisons and as targets for research and innovation policy. An example of such an indicator is R&D intensity. The decomposition of the aggregate corporate R&D intensity is able to explain the differences in R&D intensity between countries by determining whether is the result of firms’ underinvestment in R&D or of the differences across sectors. Despite its importance, the literature of corporate R&D intensity decomposition has been developed only recently. This article reviews for the first time the different methodological frameworks of corporate R&D intensity decomposition and how they are used in practice, shedding light on why sometimes empirical results seem to be contradictory. It inspects how the use of different data sources and analytical methods affect R&D intensity decomposition results, and what the analytical and policy implications are. The article also provides methodological and analytical guidance to analysts and policymakers.

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