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Strategic Trade Policy and International Trade in the Presence of International Cross-Ownership

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This paper examines the effects of international cross-ownership of firms on trade pattern and social welfare in the three-country trade model in which firms in oligopolistic industry of two countries engage in intra-industry trade and export to the third country as well. The paper shows how international ownership of firms affects trade flow and firm values via strategic trade policies in such a model. The paper also considers the effect of inter national ownership on national welfare and world welfare.

Abstract

Ⅰ. Introduction

Ⅱ. The Model: Cournot-Nash Oligopoly

Ⅲ. Social Welfare and Trade Regime

Ⅳ. Concluding Remarks

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