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Title: Asymmetric entry equilibrium in a symmetric trading oligopoly
Authors: Edwards, T. Huw
Issue Date: 2014
Publisher: © Loughborough University
Citation: EDWARDS, T.H., 2014. Asymmetric entry equilibrium in a symmetric trading oligopoly. Loughborough University School of Business and Economics, WP 2014 – 03.
Series/Report no.: Economics Discussion Paper Series;WP 2014 – 03
Abstract: We examine the R&D and export decisions of two ex ante symmetric firms in symmetric countries, with both unit trade costs and fixed entry costs to the export market. When both trade costs are low, there will be a symmetric, cross-hauling duopoly, but if fixed costs are fairly high, unit trade costs are low and R&D is relatively cheap, there will be an asymmetric entry equilibrium, in which the exporting firm carries out higher R&D, has lower costs and larger profits. With higher R&D costs and/or higher unit trade costs, there will also be a zone where crosshauling duopoly and non-trading are simultaneously Nash equilibria.
Description: This is a working paper.
Version: Submitted for publication
URI: https://dspace.lboro.ac.uk/2134/15708
ISSN: 1750-4171
Appears in Collections:Working Papers (Economics)

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