Title

The Kemp-Wan Proposition under Increasing Returns to Scale and Oligopolistic Competition

Abstract

We show that the Kemp-Wan proposition concerning the formation of customs union holds under conditions of imperfect competition and increasing returns.

*An earlier version of the present paper was presented at ISER, Osaka University, and 1997 IEFS Japan Meeting, Kobe University. We thank T. Furusawa, J. Iritani, K. Kuga, K. Mino, Y. Ono, K. Shimomura and T. Saijo for valuable comments and suggetions.

Murray C. KEMP
University of New South Wales

Koji SHIMOMURA
Research Institute for Economics and Business Administration
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: (81) 78 803 7036
Fax: (81) 78 803 7059