Tariffs, Spillovers and North-South Trade

In this paper, author examine the issue of the optimal tariff in circumstances in which trade between the ‘North’ (a developed country) and the ‘South’ (a developing country) takes place. Firms compete in quantities (‘Cournot competition’) in an imperfectly competitive Northern market. In addition, there are leakages of technological knowledge (‘spillovers’) from the North to the South. The interaction between tariffs and spillovers, together with its consequences for the social welfare of the North, is the focus of the paper. Another closely related motivation of this paper stems from the observation that the so called punitive tariffs are being used as device to punish violators of intellectual property rights

On Jain’s digital piracy model: horizontal vs vertical product differentiation

We study how private intellectual property rights protection affects equilibrium prices in a duopoly competition between firms that offer a product variety of distinct qualities (vertical product differentiation) in a setup that is closely related to that put forward by Jain where firms offer the same qualities in equilibrium (horizontal product differentiation). Consumers may make a choice to buy a legal version, use an illegal copy (if they want to and can), or not use a product at all. Using an illegal version violates intellectual property rights protection and is thus punishable when discovered. Thus, both private and public (copyright) intellectual property rights protection are available on scene

The role of the foreign direct investment with the focus on economic transition: spillovers, empirical evidence and lessons

We compare the social welfare generated by a domestic government in the two types of policy setups

Private and public IPR protection in a vertically differentiated software duopoly

We study the interaction between public and private intellectual property rights (IPR) protection in a duopoly in which software developers offer a product variety of differing quality and compete for heterogeneous users, who have an option to buy a legal version, possibly use an illegal copy, or not buy a product at all. Illegal usage implies violation of IPR and is punishable. A developer may use private IPR protection for his software if the level of piracy is high. An important intermediate step in our analysis addresses firms’ pricing strategies and the analysis of the impact of both private and public IPR protection on these strategies (with monopoly serving as a benchmark case). Last but not least, we make some comparisons with an analogous model based on horizontal product differentiation

Free trade versus strategic trade as a choice between two 'second best' policies: A symmetric versus asymmetric information analysis

We analyse the following policy dilemma: strategic trade policy versus free trade when the domestic government is bound to intervene only after the domestic firm's strategic variable in the form of R&D investment is chosen, and when the information can be either symmetric or asymmetric. The novel feature of our model is that the information asymmetry stems from the assumption that the government may not a priori know the true mode of competition. The intervention in the above set-up allows the domestic firm to manipulate the domestic government and results in a socially inefficient choice of the strategic variable. However, commitment to free trade leads to forgoing the benefits from profit-shifting. Yet, from the social point of view, free trade may be optimal even under the assumption of symmetric information. Due to costly signalling, this result is reinforced in the case of asymmetric information.Strategic trade policy, free trade, first-best versus second-best policy, government's commitment, signalling,