MFN status and the choice of tariff regime

The gradualist approach to trade liberalization views the uniform tariffs implied by MFN status as an important step on the path to free trade. We investigate whether a regime of uniform tariffs will be preferable to discriminatory tariffs when countries engage in non-cooperative interaction in multilateral trade. The analysis includes product differentiation and asymmetric costs. We show that with the cost asymmetry the countries will disagree on the choice of tariff regime. When the choice of import tariffs and export subsidies is made sequentially the uniform tariff regime may not be sustainable, because of an incentive to deviate to a discriminatory regime. Hence, an international body is needed to ensure compliance with tariff agreement

Bailouts in a common market: a strategic approach

Governments in the EU grant Rescue and Restructure Subsidies to bail out ailing firms. In an international asymmetric Cournot duopoly we study effects of such subsidies on market structure and welfare. We adopt a common market setting, where consumers from the two countries form one market. We show that the subsidy is positive also when it fails to prevent the exit. The reason is a strategic effect, which forces the more efficient firm to make additional cost-reducing effort. When the exit is prevented, allocative and productive efficiencies are lower and the only gaining player is the rescued firm

Selection, transmission, and reversion of an antigen-processing cytotoxic T-lymphocyte escape mutation in Human Immunodeficiency Virus Type 1 infection

Numerous studies now support that human immunodeficiency virus type 1 (HIV-1) evolution is influenced by immune selection pressure, with population studies showing an association between specific HLA alleles and mutations within defined cytotoxic T-lymphocyte epitopes. Here we combine sequence data and functional studies of CD8 T-cell responses to demonstrate that allele-specific immune pressures also select for mutations flanking CD8 epitopes that impair antigen processing. In persons expressing HLA-A3, we demonstrate consistent selection for a mutation in a C-terminal flanking residue of the normally immunodominant Gag KK9 epitope that prevents its processing and presentation, resulting in a rapid decline in the CD8 T-cell response. This single amino acid substitution also lies within a second HLA-A3-restricted epitope, with the mutation directly impairing recognition by CD8 T cells. Transmission of the mutation to subjects expressing HLA-A3 was shown to prevent the induction of normally immunodominant acute-phase responses to both epitopes. However, subsequent in vivo reversion of the mutation was coincident with delayed induction of new CD8 T-cell responses to both epitopes. These data demonstrate that mutations within the flanking region of an HIV-1 epitope can impair recognition by an established CD8 T-cell response and that transmission of these mutations alters the acute-phase CD8+ T-cell response. Moreover, reversion of these mutations in the absence of the original immune pressure reveals the potential plasticity of immunologically selected evolutionary changes

Industry concentration and strategic trade policy in successive oligopoly

We study a policy game between exporting and importing countries in vertically linked industries. In a successive international Cournot oligopoly, we analyse incentives for using tax instruments strategically to shift rents vertically, between exporting and importing countries, and horizontally, between exporting countries. We show that the equilibrium outcome depends crucially on the relative degree of competitiveness in the upstream and downstream parts of the industry. With respect to national welfare, a more competitive upstream industry may benefit an exporting (upstream) country and harm an importing (downstream) country. On the other hand, a more competitive downstream industry may harm exporting countries.Financial support from the Norwegian Research Council, through the PETROPOL research programme, is gratefully acknowledged. The paper has been greatly improved by the suggestions of two anonymous referees. We also thank Hisashi Hokari and Frode Meland for valuable comments and suggestions

Collusion through Joint R&D: An Empirical Assessment

This paper tests whether upstream R&D cooperation leads to downstream collusion. We consider an oligopolistic setting where firms enter in research joint ventures (RJVs) to lower production costs or coordinate on collusion in the product market. We show that a sufficient condition for identifying collusive behavior is a decline in the market share of RJV-participating firms, which is also necessary and sufficient for a decrease in consumer welfare. Using information from the US National Cooperation Research Act, we estimate a market share equation correcting for the endogeneity of RJV participation and R&D expenditures. We find robust evidence that large networks between direct competitors – created through firms being members in several RJVs at the same time – are conducive to collusive outcomes in the product market which reduce consumer welfare. By contrast, RJVs among non-competitors are efficiency enhancing

Scattering from Singular Potentials in Quantum Mechanics

In non-relativistic quantum mechanics, singular potentials in problems with spherical symmetry lead to a Schrodinger equation for stationary states with non-Fuchsian singularities both as r tends to zero and as r tends to infinity. In the sixties, an analytic approach was developed for the investigation of scattering from such potentials, with emphasis on the polydromy of the wave function in the r variable. The present paper extends those early results to an arbitrary number of spatial dimensions. The Hill-type equation which leads, in principle, to the evaluation of the polydromy parameter, is obtained from the Hill equation for a two-dimensional problem by means of a simple change of variables. The asymptotic forms of the wave function as r tends to zero and as r tends to infinity are also derived. The Darboux technique of intertwining operators is then applied to obtain an algorithm that makes it possible to solve the Schrodinger equation with a singular potential containing many negative powers of r, if the exact solution with even just one term is already known.Comment: 19 pages, plain Tex. In this revised version, the analysis of Eq. (5.29) has been amended, and an appendix has been added for completenes

Differential narrow focusing of immunodominant human immunodeficiency virus Gag-specific cytotoxic T-Lymphocyte responses in infected African and Caucasoid adults and children

Cytotoxic T-lymphocyte (CTL) activity plays a central role in control of viral replication and in determining outcome in cases of human immunodeficiency virus type 1 (HIV-1) infection. Incorporation of important CTL epitope sequences into candidate vaccines is, therefore, vital. Most CTL studies have focused upon small numbers of adult Caucasoid subjects infected with clade-B virus, whereas the global epidemic is most severe in sub-Saharan African populations and predominantly involves clade-C infection in both adults and children. In this study, sensitive enzyme-linked immunospot (elispot) assays have been utilized to identify the dominant Gag-specific CTL epitopes targeted by adults and children infected with clade-B or -C virus. Cohorts evaluated included 44 B-clade-infected Caucasoid American and African American adults and children and 37 C-clade-infected African adults and children from Durban, South Africa. The results show that 3 out of 46 peptides spanning p17Gag and p24Gag sequences tested contain two-thirds of the dominant Gag-specific epitopes, irrespective of the clade, ethnicity, or age group studied. However, there were distinctive differences between the dominant responses made by Caucasoids and Africans. Dominant responses in Caucasoids were more often within p17Gag peptide residues 16 to 30 (38 versus 12%; P 30% of the total infected population in Durban. This epitope is closely homologous with dominant HIV-2 and simian immunodeficiency virus Gag-specific CTL epitopes. The fine focusing of dominant CTL responses to these few regions of high immunogenicity is of significance to vaccine design

Churn, Baby, Churn: Strategic Dynamics Among Dominant and Fringe Firms in a Segmented Industry

This paper integrates and extends the literatures on industry evolution and dominant firms to develop a dynamic theory of dominant and fringe competitive interaction in a segmented industry. It argues that a dominant firm, seeing contraction of growth in its current segment(s), enters new segments in which it can exploit its technological strengths, but that are sufficiently distant to avoid cannibalization. The dominant firm acts as a low-cost Stackelberg leader, driving down prices and triggering a sales takeoff in the new segment. We identify a “churn” effect associated with dominant firm entry: fringe firms that precede the dominant firm into the segment tend to exit the segment, while new fringe firms enter, causing a net increase in the number of firms in the segment. As the segment matures and sales decline in the segment, the process repeats itself. We examine the predictions of the theory with a study of price, quantity, entry, and exit across 24 product classes in the desktop laser printer industry from 1984 to 1996. Using descriptive statistics, hazard rate models, and panel data methods, we find empirical support for the theoretical predictions