Strategic Trade Policy in Bargaining over Managerial Delegation Competition

In this paper, we assess the influence of the generalized Nash bargaining model on strategic trade policies. In particular, how the trade policy and the bargaining process over managerial contract are strategically connected within the context of bargaining over the sales delegation model is analyzed. We explore the policy impacts in two different models: the export rivalry model and the import-competing model, and show that the introduction of managers' bargaining process leads to a decrease in the export subsidy and optimal tariff in different models.