Regulatory standards can lead to predation

Arbeitspapier

I present a model of vertical product differentiation and exit where a domestic and a foreign firm face fixed setup costs and quality-dependent costs of production and compete in quality and price in the domestic market. Quality-dependent costs are quadratic in qualities, but independent of the quantities produced. The domestic government may impose a minimum quality standard binding for both foreign and domestic firms. In the present of an initial cost advantage of the domestic firm, a sufficiently high minimum quality standard set by the domestic government will enable the domestic firm to induce exit of the foreign firm, i.e. to engage in predation. However, the same standard would lead to predation by the foreign firm, if the foreign firm had the initial cost advantage!

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: ZEI Working Paper ; No. B 05-2005

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Models of Trade with Imperfect Competition and Scale Economies; Fragmentation ; Trade Policy; International Trade Organizations ; Oligopoly and Other Imperfect Markets
• Thema: vertical product differentiation ; oligopoly ; trade ; quality ; country asymmetries ; Produktdifferenzierung ; Produktqualität ; Oligopol ; Normung ; Internationaler Wettbewerb ; Verdrängungswettbewerb ; Komparativer Kostenvorteil ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Lutz, Stefan
• Ereignis: Veröffentlichung
• (wer): Rheinische Friedrich-Wilhelms-Universität Bonn, Zentrum für Europäische Integrationsforschung (ZEI)
• (wo): Bonn
• (wann): 2005

Weitere Informationen

• Handle: http://hdl.handle.net/10419/39531
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ