A puzzle in the analysis of trade policy is why free trade outcomes, which maximize world income, are not more often observed. One reason is that economics agents with special interests affect both the form and level of international protective policies. This paper investigates the dynamic...

This paper examines the transitional dynamics of economic integration in the two country endogenous growth model of Rivera-Batiz and Romer (1991) and in an extension by Rivera-Batiz and Xie (1992). It is shown that, in the absence of knowledge flows across countries economic integration will...

Strategic interaction among oligopolistic innovators and its implications for economic growth are examined in two dynamic computable general equilibrium models. In each environment, technologies for producing a final good are such that the profits of any intermediate good producer depend on the...

There are at least two versions of the Law of One Price under the assumptions of perfect competition, no trade barriers, and no transport costs. One version predicts equal prices of competing goods sold in the same country and manufactured by producers located in different countries. Another...

Monthly West German producer, export, and import price indices are examined to investigate relationships among international prices. The data provides evidence of highly persistent time-varying deviations in the Law of One Price both across countries by a single producer and within a country by...

The effects of entry and exit by monopolistically competitive intermediate goods producers on equilibrium business cycles are analyzed in the presence of internal returns to scale and external returns to specialization. In the environment studied, market power and endogenous entry and exit, in...

The effects of an unilateral tariff on prices, quantities, and welfare in the presence of a dynamic elements facing imperfectly competitive firms is examined. International duopolists, selling differentiated products, interact strategically in price setting game under the tariff policy. It is...

We re-examine the regulatory role of a public firm in an environment of private but correlated information about industry costs. We study three regimes of mixed market interaction involving both public and private firms: a symmetric Bayesian-Nash equilibrium, an asymmetric Bayesian equilibrium...

A model of sequential entry with Leontief costs is studied in which demand is iso-elastic. Some or all firms may hold excess capacity in the perfect equilibrium to the entry game. Firms with a first mover advantage trade off the positioning value of a large investment in capacity, leading to a...

This paper examines market failure in a monopolistically competitive industry with differentiated products. The set of products sold and prices are compared between monopolistic competition and a social optimum. The industry is asymmetric as products differ in their objective characteristics....