Can subsidies for MARs be procompetitive?

Kala Krishna, Suddhasatwa Roy, Marie Thursby

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

In contrast to recent literature, we show that market access requirements (MARs) can be implemented in a procompetitive manner even in the absence of threats in related markets. By focusing on subsidies that are paid only when the requirement is met, we show that a MAR can increase aggregate output relative to free trade provided that the right set of firms is targeted. In the context of a model with multiple Japanese and U.S. firms, we show that a MAR on U.S. imports is procompetitive as long as the U.S. firms are the ones targeted to receive the subsidy.

Original languageEnglish (US)
Pages (from-to)212-224
Number of pages13
JournalCanadian Journal of Economics
Volume34
Issue number1
DOIs
StatePublished - Jan 1 2001

Fingerprint

Market access
Subsidies
Import
Free trade
Threat
Aggregate output

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

Cite this

Krishna, Kala ; Roy, Suddhasatwa ; Thursby, Marie. / Can subsidies for MARs be procompetitive?. In: Canadian Journal of Economics. 2001 ; Vol. 34, No. 1. pp. 212-224.
@article{819ee445c1174956819eef057954d4e0,
title = "Can subsidies for MARs be procompetitive?",
abstract = "In contrast to recent literature, we show that market access requirements (MARs) can be implemented in a procompetitive manner even in the absence of threats in related markets. By focusing on subsidies that are paid only when the requirement is met, we show that a MAR can increase aggregate output relative to free trade provided that the right set of firms is targeted. In the context of a model with multiple Japanese and U.S. firms, we show that a MAR on U.S. imports is procompetitive as long as the U.S. firms are the ones targeted to receive the subsidy.",
author = "Kala Krishna and Suddhasatwa Roy and Marie Thursby",
year = "2001",
month = "1",
day = "1",
doi = "10.1111/0008-4085.00071",
language = "English (US)",
volume = "34",
pages = "212--224",
journal = "Canadian Journal of Economics",
issn = "0008-4085",
publisher = "Wiley-Blackwell",
number = "1",

}

Can subsidies for MARs be procompetitive? / Krishna, Kala; Roy, Suddhasatwa; Thursby, Marie.

In: Canadian Journal of Economics, Vol. 34, No. 1, 01.01.2001, p. 212-224.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Can subsidies for MARs be procompetitive?

AU - Krishna, Kala

AU - Roy, Suddhasatwa

AU - Thursby, Marie

PY - 2001/1/1

Y1 - 2001/1/1

N2 - In contrast to recent literature, we show that market access requirements (MARs) can be implemented in a procompetitive manner even in the absence of threats in related markets. By focusing on subsidies that are paid only when the requirement is met, we show that a MAR can increase aggregate output relative to free trade provided that the right set of firms is targeted. In the context of a model with multiple Japanese and U.S. firms, we show that a MAR on U.S. imports is procompetitive as long as the U.S. firms are the ones targeted to receive the subsidy.

AB - In contrast to recent literature, we show that market access requirements (MARs) can be implemented in a procompetitive manner even in the absence of threats in related markets. By focusing on subsidies that are paid only when the requirement is met, we show that a MAR can increase aggregate output relative to free trade provided that the right set of firms is targeted. In the context of a model with multiple Japanese and U.S. firms, we show that a MAR on U.S. imports is procompetitive as long as the U.S. firms are the ones targeted to receive the subsidy.

UR - http://www.scopus.com/inward/record.url?scp=0005730330&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=0005730330&partnerID=8YFLogxK

U2 - 10.1111/0008-4085.00071

DO - 10.1111/0008-4085.00071

M3 - Article

AN - SCOPUS:0005730330

VL - 34

SP - 212

EP - 224

JO - Canadian Journal of Economics

JF - Canadian Journal of Economics

SN - 0008-4085

IS - 1

ER -