Description: Equilibrium Parallel Import Policies and International Market Structure

Equilibrium Parallel Import Policies and International Market Structure

In a North-South vertically differentiated duopoly, the analysis in this paper derives equilibrium government policies towards parallel imports. By incorporating strategic interaction at the policy-setting stage and the product market, the model sh...

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Bibliographic Details
Main Authors:	Roy, Santanu, Saggi, Kamal
Language:	English
Published:	2012
Subjects:	ADVERSE EFFECT ARBITRAGE COMPETITOR CONSUMER INTERESTS CONSUMER SURPLUS CONSUMERS CONVENTIONAL INSTRUMENTS DEMAND CURVE DEMAND FUNCTIONS DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIFFERENTIAL PRICING DOMESTIC MARKET DOMESTIC PRICE DUOPOLY ECONOMIC INTEGRATION ECONOMIC LAW ECONOMIC RESEARCH ECONOMICS ECONOMICS RESEARCH ENTREPRENEURS EQUILIBRIUM PRICE EQUILIBRIUM PRICES EXPANSION EXPORTS EXTERNALITIES FIRMS FIXED COSTS FOREIGN MARKET FOREIGN MARKETS FUTURE RESEARCH GAME THEORY GLOBAL MARKET HOME MARKET IMPERFECT COMPETITION INCOME INCREASING RETURNS INDUSTRIAL ECONOMICS INEFFICIENCY INTELLECTUAL PROPERTY INTELLECTUAL PROPERTY RIGHT INTELLECTUAL PROPERTY RIGHTS INTERNATIONAL MARKET INTERNATIONAL TRADE INVENTORIES MANUFACTURER MARGINAL COST MARGINAL COSTS MARKET COMPETITION MARKET DEMAND MARKET ENTRY MARKET EQUILIBRIUM MARKET POWER MARKET PRICES MARKET SEGMENTATION MARKET STRUCTURE MARKET STRUCTURES MARKETING MONOPOLIES MONOPOLY MONOPOLY PRICE MONOPOLY PRICES MULTINATIONALS NASH EQUILIBRIUM NATURAL MONOPOLY OLIGOPOLY PATENTS PRICE COMPETITION PRICE CONTROL PRICE CONTROLS PRICE DISCRIMINATION PRICE INCREASES PRICE REGULATION PRICING STRATEGY PRODUCT DIFFERENTIATION PRODUCT MARKET PRODUCT QUALITY PROFIT MAXIMIZATION PROPERTY RIGHTS REGULATORY CONDITIONS RETAIL SALE SALES SURPLUS TRADE POLICY TRADEMARK WORLD ECONOMY WORLD MARKETS WTO
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110920162458 http://hdl.handle.net/10986/3566

Description
Summary:	In a North-South vertically differentiated duopoly, the analysis in this paper derives equilibrium government policies towards parallel imports. By incorporating strategic interaction at the policy-setting stage and the product market, the model sheds new light on (i) the effects of parallel import policies on pricing behavior of firms and (ii) the interdependence of national parallel import policies. If demand asymmetry across countries is sufficiently large, the North forbids parallel imports to ensure its firm sells in the South thereby generating international price discrimination -- the South's most preferred market outcome -- as the equilibrium. When demand structures are relatively similar across countries, the North permits parallel imports and uniform pricing -- its most preferred market outcome -- obtains.

Equilibrium Parallel Import Policies and International Market Structure

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