Strategic Trade Policy and the Home Bias in Firm Ownership Structure
17 Pages Posted: 8 Apr 2003
Date Written: March 2003
In this note we consider the preferences of a profit maximizing firm for international ownership in a world in which firms compete in an international Cournot oligopoly, and in which countries use strategic trade policy. We find that firms prefer national ownership and show that full indigenisation occurs in the equilibrium.
Keywords: Strategic Trade, International Ownership, Cournot Oligopoly, Home Bias
JEL Classification: D43, D44, F12, L11, L13
Suggested Citation: Suggested Citation