Trade, the Damage from Alien Species, and the Effects of Protectionism Under Alternate Market Structures

RIT Economics Department Working Paper No. 08-02

39 Pages Posted: 1 Jan 2008

See all articles by Amitrajeet A. Batabyal

Amitrajeet A. Batabyal

Rochester Institute of Technology (RIT) - Department of Economics

Hamid Beladi

University of Texas at San Antonio - College of Business - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: January 2008

Abstract

We first construct three measures of the expected damage from the unintentional introduction of alien species into a country called Home. We then focus on four market structures. First, perfect competition prevails in both Home and Foreign and Home is a small country. Second, the Home and the Foreign markets are both perfectly competitive but Home is now a large country. Third, the exporter in Foreign is a monopolist and there are no import competing firms in Home. Finally, the Foreign exporter and the import competing firm in Home engage in Cournot competition. In all four scenarios, we analyze the impact of small and optimal Home tariffs on prices, exports, imports, the damage from alien species, and social welfare, in Home. Inter alia, our analysis identifies conditions under which it makes sense to use trade policy (tariffs) to regulate invasive species and conditions under which it does not.

Keywords: Alien Species, International Trade, Market Structure, Social Welfare, Tariff

JEL Classification: Q560, F130, F180

Suggested Citation

Batabyal, Amitrajeet A. and Beladi, Hamid, Trade, the Damage from Alien Species, and the Effects of Protectionism Under Alternate Market Structures (January 2008). RIT Economics Department Working Paper No. 08-02, Available at SSRN: https://ssrn.com/abstract=1079684 or http://dx.doi.org/10.2139/ssrn.1079684

Amitrajeet A. Batabyal (Contact Author)

Rochester Institute of Technology (RIT) - Department of Economics ( email )

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Hamid Beladi

University of Texas at San Antonio - College of Business - Department of Economics ( email )

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P.O. Box 5636
San Antonio, TX 78249
United States
210-458-7038 (Phone)
210-458-7040 (Fax)

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