This paper examines the mode of entry of a multinational firm that has less information about the host market stochastic demand than the local firm. The foreign firm can enter the market either through direct investment or exports. Each entry mode entails different costs and has different...

We examine the FDI versus exports decision of firms competing in an oligopolistic (quantity-setting) market under demand uncertainty and asymmetric information. Compared to a firm that chooses to export, a firm that chooses to set up a plant in the host market has superior information about...

We revisit and extend previous theoretical work on internationalization decisions by firms which are imperfectly informed on the state of the demand in the market into which they are planning to export or enter through foreign direct investment (FDI). The latter is a costly strategy mitigating...

This article presents a link between tariff rates and industry structure in a dynamic setting. We examine the role of tariffs on final-goods in a firm's decision to integrate and collude in the presence of competitive imports. It is shown that, under some conditions, the upstream firm has an...