Direct regulations have two regimes. In one, all firms behave in the same manner and in the other they behave differently. Past work assumed all firms were identical, thereby neglecting the non-monotonicity in comparative statics arising from the regime change

Direct regulations have two regimes. In one, all firms behave in the same manner and in the other they behave differently. Past work assumed all firms were identical, thereby neglecting the non-monotonicity in comparative statics arising from the regime change

This paper deals with the effect of trade restrictions on competition in oligopolistic markets. Quantitative restrictions, such as VER's (Voluntary Export Restrictions) are shown to affect the extent to which foreign firms can compete in the domestic market, and hence to raise the equilibrium...