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Time consistency, learning by doing and infant-industry protection: The linear case
Leahy, Dermot; Neary, J. Peter
This paper examines the implications for strategic trade policy of diiferent assumptions about precommitment in a dynamic oligopoly game with learning by doing. Assuming that demands are linear, we find that the optimal first-period subsidy is increasing in the rate of learning with precommitment but decreasing in it if the government cannot precommit to future subsidies. The infant-industry argument is thus reversed in the absence of precommitment.
Keyword(s): Trade policy; Infant-industry; Learning
Publication Date:
1994
Type: Journal article
Peer-Reviewed: Unknown
Language(s): English
Institution: Trinity College Dublin
Citation(s): Leahy, Dermot; Neary, J. Peter. 'Time consistency, learning by doing and infant-industry protection: The linear case'. - Economic & Social Review, Vol. 26, No. 1, October, 1994, pp. 59-68, Dublin: Economic & Social Research Institute
Publisher(s): Economic & Social Studies
First Indexed: 2014-05-13 05:25:31 Last Updated: 2018-08-12 06:14:44