Import now! An analysis of market-share voluntary import expansions (VIEs)
用伯特兰模型分析自愿进口扩张(VIE)政策,发现它反而会提高国内市场价格,与支持者声称的促进竞争和降价相反。
Proponents claim that voluntary import expansions (VIEs) increase foreign access to a domestic market while increasing competition and reducing prices. Using a Bertrand model, I show that a VIE produces exactly the opposite results. A VIE that increases the market share of imports above the prevailing level results in higher prices in the domestic market. This result holds even when the domestic market is assumed to be protected by a tariff-type barrier prior to the imposition of a VIE. A VIE and an equivalent import subsidy are shown to have opposite effects on prices.