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Switching costs and the impact of trade liberalization
- Source :
- Economics Bulletin. 6(6):1-7
- Publication Year :
- 2007
-
Abstract
- This paper considers a two-period model of market entry with horizontally differentiated products and switching costs. Conditions that are conducive to a competitive environment in the second period are shown to yield a less competitive outcome in the first period. That is, when the marginal cost of a foreign entrant is relatively low, the first-period output of a domestic monopolist is relatively low as well.
- Subjects :
- cost competitiveness
jel:F1
Subjects
Details
- Volume :
- 6
- Issue :
- 6
- Database :
- OpenAIRE
- Journal :
- Economics Bulletin
- Accession number :
- edsair.dedup.wf.001..85fedd7424c5a3561a29ddf2dc6fe32f