<abstract xmlns="http://www.w3.org/1999/xhtml"><p>This paper analyzes the differences between strategic trade and the competitionm policies (in the form of inward Foreign Direct Investment) to regulate a unionized monopoly in the domestic country. With decentralized negotiations both policies reduce labour and product market distortions. However the fixed cost for the foreign entrant and the degree of product differentiation determine which policy should be implemented to maximize national welfare, and the cases in which the domestic government can intervene, to achieve a Pareto-improvement.</p></abstract>

This paper analyzes the differences between strategic trade and the competitionm policies (in the form of inward Foreign Direct Investment) to regulate a unionized monopoly in the domestic country. With decentralized negotiations both policies reduce labour and product market distortions. However the fixed cost for the foreign entrant and the degree of product differentiation determine which policy should be implemented to maximize national welfare, and the cases in which the domestic government can intervene, to achieve a Pareto-improvement.

Strategic trade and FDI policies in a unionized industry

Economics and Business Review

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

{"article-title":"Strategic trade and FDI policies in a unionized industry"}

This paper analyzes the differences between strategic trade and the competitionm policies (in the form of inward Foreign Direct Investment) to regulate a...

Strategic trade and FDI policies in a unionized industry

Published Online: Apr 07, 2019

Page range: 12 - 31

Received: Aug 24, 2018

Accepted: Dec 15, 2018

DOI: https://doi.org/10.18559/ebr.2019.1.2

Keywords
strategic trade policy, FDI policy, unionized markets

© 2019 Domenico Buccella, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Strategic trade and FDI policies in a unionized industry

Published Online: Apr 07, 2019

Page range: 12 - 31

Received: Aug 24, 2018

Accepted: Dec 15, 2018

DOI: https://doi.org/10.18559/ebr.2019.1.2

Keywordsstrategic trade policy, FDI policy, unionized markets

© 2019 Domenico Buccella, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
strategic trade policy, FDI policy, unionized markets