It has recently been suggested by several authors that a Cournot-Nash free-trade equilibrium might leave each country worse off than under autarky, in apparent contradiction of earlier findings. In the present note it is shown that the suggestion is typically based on self-contradictory...

It is well known that if the autarkic and free-trade equilibria are perfectly competitive with market distortions limited to non-negative taxes on imports and exports then free trade is potentially (after country-specific lumpsum compensatory transfers) beneficial for each trading country. It...