UNSPECIFIED (1993) EXPORT SUBSIDIES AS SIGNALS OF COMPETITIVENESS. In: CONF OF THE INTERNATIONAL-ECONOMICS-STUDY-GROUP, APR, 1992, MANCHESTER, ENGLAND.

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Abstract

In a Cournot duopoly model of international competition between a domestic and foreign firm, it is shown that when the foreign firm has incomplete information about the marginal cost of the domestic firm then the domestic government can use an export subsidy to signal the competitiveness of its firm. This signalling effect strengthens the usual profit-shifting argument for an export subsidy, The optimal export subsidy in the signalling equilibrium may be twice as large as the optimal profit-shifting export subsidy under complete information.

Item Type:	Conference Item (UNSPECIFIED)
Subjects:	H Social Sciences > HC Economic History and Conditions
Journal or Publication Title:	SCANDINAVIAN JOURNAL OF ECONOMICS
Publisher:	BLACKWELL PUBL LTD
ISSN:	0347-0520
Date:	1993
Volume:	95
Number:	3
Number of Pages:	13
Page Range:	pp. 327-339
Publication Status:	Published
Title of Event:	CONF OF THE INTERNATIONAL-ECONOMICS-STUDY-GROUP
Location of Event:	MANCHESTER, ENGLAND
Date(s) of Event:	APR, 1992
URI:	http://wrap.warwick.ac.uk/id/eprint/21056

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