Endogenous transportation technology in a cournot differential game with intraindustry trade

Colombo, Luca, Lambertini, Luca and Mantovani, Andrea 2009, Endogenous transportation technology in a cournot differential game with intraindustry trade, Japan and the world economy, vol. 21, no. 2, pp. 133-139.

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Title Endogenous transportation technology in a cournot differential game with intraindustry trade
Author(s) Colombo, Luca
Lambertini, Luca
Mantovani, Andrea
Journal name Japan and the world economy
Volume number 21
Issue number 2
Start page 133
End page 139
Publisher Elsevier B. V.
Place of publication Amsterdam, The Netherlands
Publication date 2009-03
ISSN 0922-1425
Keyword(s) R&D
differential games
transport and communication costs
intraindustry trade
Summary We investigate a dynamic Cournot duopoly with intraindustry trade, where firms invest in R&D to reduce the level of iceberg transportation costs. We adopt both open-loop and closed-loop equilibrium concepts, showing that a unique (saddle point) steady state exists in both cases. In the open-loop model, optimal investments and the resulting efficiency of transportation technology are independent of the relative size of the two countries. On the contrary, in the closed-loop case firms’ R&D incentives are driven by the relative size of the two countries. Policy implications are also evaluated.
Language eng
Field of Research 140299 Applied Economics not elsewhere classified
Socio Economic Objective 910399 International Trade not elsewhere classified
HERDC Research category C1.1 Refereed article in a scholarly journal
Copyright notice ©2008, Elsevier B.V.
Persistent URL http://hdl.handle.net/10536/DRO/DU:30022986

Document type: Journal Article
Collections: Faculty of Business and Law
School of Accounting, Economics and Finance
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