Exports, FDI and Infrastructure in Oligopoly
Abstract
This paper extrapolates it to oligopolistic Cournot competition based on the main components of the Belt and Road - exports, FDI
and infrastructure. The paper first establishes a basic linear demand duopoly model and extends the firm costs under-investment in transpor_x005ftation infrastructure by adding transportation costs to the base model. Third, the firm responses under other infrastructure investments are
discussed, adjusting the original market size. Finally, conclusions are also drawn about how different investment approaches can affect each
other as different investments in infrastructure lead to further cost reductions.
and infrastructure. The paper first establishes a basic linear demand duopoly model and extends the firm costs under-investment in transpor_x005ftation infrastructure by adding transportation costs to the base model. Third, the firm responses under other infrastructure investments are
discussed, adjusting the original market size. Finally, conclusions are also drawn about how different investment approaches can affect each
other as different investments in infrastructure lead to further cost reductions.
Keywords
Exports; FDI and Infrastructure; Oligopoly
Full Text:
PDFReferences
[1] Anderson, J. and van Wincoop, E., 2004. Trade Costs. Journal of Economic Literature.
[2] Balistreri, E., Hillberry, R. and Rutherford, T., 2010. Trade and welfare: Does industrial organization matter?. Economics Letters.
[3] Bird, J., Lebrand, M. and Venables, A., 2020. The Belt and Road Initiative: Reshaping economic geography in Central Asia?. Jour_x005fnal of Development Economics.
[4] Cheng, L., 2016. Three questions on China’s “Belt and Road Initiative”. China Economic Review.
[5] De Soyres, F., Mulabdic, A. and Ruta, M., 2019. Common Transport Infrastructure. Washington, D.C.: The World Bank.
[6] Ono, H. and Davis, C., 2021. Intra-Industry Trade and FDI under Oligopoly Trade Patterns and Trade Policies.
DOI: http://dx.doi.org/10.18686/fm.v8i6.11722
Refbacks
- There are currently no refbacks.
