Endogenous Lobbying Positions

13 Pages Posted: 20 Aug 2008

See all articles by Larry D. Qiu

Larry D. Qiu

The University of Hong Kong - Faculty of Business and Economics; Hong Kong University of Science & Technology (HKUST) - Department of Economics

Abstract

This paper develops a two-country, two-firm model to study equilibrium lobbying positions in intra-industry trade. A firm chooses either a protectionist position or a free-trade position. The model predicts that taking the free-trade lobbying position is an efficient firm's dominant strategy. If two firms have high costs (or when the demand is very weak), there exist two equilibria: either both firms take the free-trade position or both take the protectionist lobbying position. In other cases, both firms taking the free-trade lobbying position is a unique equilibrium.

Suggested Citation

Qiu, Larry Dongxiao, Endogenous Lobbying Positions. Review of International Economics, Vol. 16, Issue 4, pp. 641-653, September 2008. Available at SSRN: https://ssrn.com/abstract=1239371 or http://dx.doi.org/10.1111/j.1467-9396.2008.00769.x

Larry Dongxiao Qiu (Contact Author)

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Hong Kong University of Science & Technology (HKUST) - Department of Economics ( email )

School of Economics and Finance
University of Hong Kong
Pokfulam
Hong Kong

HOME PAGE: http://www.bm.ust.hk/~larryqiu/

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