Switching costs and the impact of trade liberalization

Toru Kikuchi

Economics Bulletin, 2007, vol. 6, issue 6, 1-7

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.

Keywords: cost; competitiveness (search for similar items in EconPapers)
JEL-codes: F1 (search for similar items in EconPapers)
Date: 2007-03-07
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Citations: View citations in EconPapers (3)

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