<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>The main goal of this article is to contribute to the theoretical analysis of international trade under imperfect competition using the Cournot oligopoly model with heterogeneous firms. In particular, our objective is to provide some insights into the role of cost asymmetry in studying the effects of trade liberalisation in the Cournot oligopoly framework. In order to introduce firm heterogeneity into the oligopoly model we use the generalised Cournot framework with asymmetric firms that differ in terms of their productivity, levels of output and market shares. We show that trade liberalisation leads to the elimination of less productive firms and results in lower equilibrium prices, higher sales per firm and lower markups in the industry.</p>
</abstract>

The main goal of this article is to contribute to the theoretical analysis of international trade under imperfect competition using the Cournot oligopoly model with heterogeneous firms. In particular, our objective is to provide some insights into the role of cost asymmetry in studying the effects of trade liberalisation in the Cournot oligopoly framework. In order to introduce firm heterogeneity into the oligopoly model we use the generalised Cournot framework with asymmetric firms that differ in terms of their productivity, levels of output and market shares. We show that trade liberalisation leads to the elimination of less productive firms and results in lower equilibrium prices, higher sales per firm and lower markups in the industry.

Firm Heterogeneity and International Trade Liberalisation: A Generalized Cournot Oligopoly Approach

Central European Economic Journal

This work is licensed under the Creative Commons Attribution 4.0 International License.

The main goal of this article is to contribute to the theoretical analysis of international trade under imperfect competition using the Cournot oligopoly model...

Firm Heterogeneity and International Trade Liberalisation: A Generalized Cournot Oligopoly Approach

Published Online: Mar 28, 2024

Page range: 67 - 78

DOI: https://doi.org/10.2478/ceej-2024-0007

Keywords
Cournot oligopoly model, firm heterogeneity, imperfect competition, international trade liberalisation, market structure

© 2024 Andrzej Cieślik, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Firm Heterogeneity and International Trade Liberalisation: A Generalized Cournot Oligopoly Approach

Published Online: Mar 28, 2024

Page range: 67 - 78

DOI: https://doi.org/10.2478/ceej-2024-0007

KeywordsCournot oligopoly model, firm heterogeneity, imperfect competition, international trade liberalisation, market structure

© 2024 Andrzej Cieślik, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Keywords
Cournot oligopoly model, firm heterogeneity, imperfect competition, international trade liberalisation, market structure