Skip to main content
Article
Unionized Bertrand Duopoly and Strategic Export Policy
Review of International Economics
  • Subhayu Bandyopadhyay
  • Sudeshna C. Bandyopadhyay
  • Eun Soo Park, Missouri University of Science and Technology
Abstract

The paper reports that an export subsidy is optimal for a unionized Bertrand duopoly. Following results published by Brander and Spencer (Journal of International Economics, 1988, pp. 217-34), this establishes the robustness of export subsidization to the mode of competition (Cournot or Bertrand), and contrasts with nonunion results in the literature. If both firms are unionized and both governments pursue active trade policies, a subsidy remains optimal except for a narrow range of extreme substitutability between products. Nations with a lower opportunity cost of labor employ more aggressive policies in equilibrium.

Department(s)
Economics
Keywords and Phrases
  • competition,
  • export,
  • trade policy,
  • trade union
Document Type
Article - Journal
Document Version
Citation
File Type
text
Language(s)
English
Rights
© 2000 Blackwell Publishing Ltd, All rights reserved.
Publication Date
2-1-2000
Publication Date
01 Feb 2000
Disciplines
Citation Information
Subhayu Bandyopadhyay, Sudeshna C. Bandyopadhyay and Eun Soo Park. "Unionized Bertrand Duopoly and Strategic Export Policy" Review of International Economics Vol. 8 Iss. 1 (2000) p. 164 - 174 ISSN: 0965-7576; 1467-9396
Available at: http://works.bepress.com/eun-soo-park/5/