December 2006
Kazuo Mino (Osaka
University), Kazuo Nishimura (Kyoto University),
Koji Shimomura (Kobe University) and Ping
Wang (Washington University in
St.Louis and NBER)
"Equilibrium Dynamics in Discrete-Time
Endogenous Growth Models with
Social Constant Returns"
Economic
Theory
<mino@econ.osaka-u.ac.jp>
The existing literature establishes
possibilities of local determinacy and
dynamic indeterminacy in continuous-time two-sector
models of endogenous growth
with social constant returns. The necessary and
sufficient condition for local
determinacy is that the factor intensity rankings of
the two sectors are consistent in
the private/physical and social/value sense.
The necessary and sufficient
condition for dynamic indeterminacy is that the final
(consumable) good sector is
human (pure) capital intensive in the private
sense but physical (consumable) capital intensive
in the social sense. This paper re-examines
the dynamic properties in a discrete-time
endogenous growth framework and finds that
conventional propositions obtained in continuous
time need not be valid. It is shown that the
established necessary and sufficient conditions
on factor intensity rankings for local determinacy
and dynamic indeterminacy are neither
sufficient nor necessary, as the magnitudes of time
preference and capital depreciation rates both
play essential roles.
Yunfang Hu (Kobe
University)
"Human Capital Accumulation, Home Production
and Equilibrium Dynamics"
Japanese
Economic Review
<hu@econ.kobe-u.ac.jp>
In this paper, we construct a three-sector
endogenous growth
model in which long-run growth is propelled by
human capital accumulation. We
show that although the addition of a home sector
to the standard two-sector
endogenous growth model preserves the well-behaved
balanced-growth
equilibrium properties, it generates new transitional
dynamics around the balanced
growth path. It is shown that, when there is a
positive shock to physical
capital, our model is more likely to exhibit
paradoxical growth than are
standard multisector
endogenous growth models that exclude home production.
Our analysis adds new results to those from
the related literature on
leisure.
Yasuhiro Takarada
(Nanzan University)
"Welfare Effects of International
Income Transfers under Transboundary Pollution"
Environmental
Economics and Policy Studies
<ytakara@ps.nanzan-u.ac.jp>
This paper examines the welfare effects of international
income transfers
in a two-country, two-good model with transboundary pollution. Most
existing studies have assumed that pollution
negatively affects the
consumer's utility function instead of influencing
production. In our
model, there is interindustry
interaction caused by pollution. First, we
show the effects of aid on each country's
welfare. Second, we show that
untied aid improves world welfare if the marginal
propensity to consume
the polluting good in the donor country is
larger than in the recipient
country. We also derive the condition for
Pareto-improving untied aid.
The source of welfare improvement is
productivity gains induced by a
reduction in pollution.
Tsuyoshi Toshimitsu
(Kwansei Gakuin University)
"A Note on Quality Choice, Monopoly,
and Network Externality"
Journal of
Industry, Competition and Trade
<ttsutomu@kwansei.ac.jp>
Introducing network externalities into a
model of vertically differentiated products, Lambertini
and Orsini (2001, 2003) analyze the implications of a
monopolist’s quality choice for social optimum. Moreover, they examine how the
network externality affects quality, quantity, price, and the social surplus.
In this note, by looking at the nature of the cost function and the degree of
the network externality, we reconsider their results, at least some of which
depend upon the specificity of the cost function.
November 2006
Yuqing
Xing （International University of
Japan） and Laixun
Zhao (Kobe University)
“Reverse Imports, Foreign Direct
Investment and Exchange Rates”
Japan and the World Economy
<zhao@rieb.kobe-u.ac.jp>
This
paper investigates linkages among “reverse imports”, foreign direct investment,
and exchange rates. As an example we have in mind the competition in the
Japanese market of a Japanese multinational firm and a Chinese domestic firm.
Products are differentiated based on Japanese consumers’ brand name
recognition. The model shows that yen appreciation leads to an increase in
Japanese production in China and “reverse imports”, and a decrease in Japanese
domestic production. Due to the barriers in brand name, the exports of the
Chinese firm could fall, because the increase of reverse imports may erode the
market share of the Chinese firm, even though total exports from China
increase. Further, we find that yen appreciation may improve the profits of the
Japanese firm and welfare in Japan under reverse imports, against conventional
wisdom. The predictions of the model fit well with the actual numbers, and shed
light on the current debate on the Chinese currency.
Kenji Fujiwara (Kwansei
Gakuin University)
“A Stackelberg
game model of dynamic duopolistic competition with sticky prices”
Economics
Bulletin
<kenjifujiwara@kwansei.ac.jp>
We develop the following Stackelberg
game model of dynamic duopoly with sticky prices; the
leader chooses its time profile of outputs to
maximize the discounted sum of profits, while the
follower chooses the optimal output to maximize the
instantaneous profit as a myopic profit maximizer at
each
point of time. Then, we compare the resulting
equilibrium outcomes with those in a Stackelberg
equilibrium without price stickiness.
October 2006
Kimura, Fukunari
(Keio University) and Kozo Kiyota (Yokohama National
University)
"Foreign-owned versus
Domestically-owned Firms: Economic Performance in Japan"
Review
of Development Economics
<fkimura@econ.keio.ac.jp>
This paper utilizes micro-panel data for
firms located in Japan and
examines differences in corporate performance
between foreign-owned and
domestically-owned firms in the 1990s. We find that
foreign-owned firms
not only reflect superior static
characteristics, but also achieve faster
growth. Moreover, foreign investors appear to
invest in firms that may not
be immediately profitable, but those that are
potentially the most
profitable in the future. There is also no evidence
that foreign
investor is "foot-loose." These imply that
foreign investors bring useful
firm-specific assets into the Japanese market, which may
work as an
effective catalyst for necessary structural reform.
Kimura, Fukunari
(Keio University) and Kozo Kiyota (Yokohama National
University)
"Exports, FDI, and Productivity of
Firm: Dynamic Evidence from Japanese Firms"
Review
of World Economics / Weltwirtschaftliches Archiv
<fkimura@econ.keio.ac.jp>
This paper examines the relationship between
exports, foreign direct
investment and firm productivity. Using longitudinal
panel data on
Japanese firms, it is found that the most
productive firms engage in
exports and foreign direct investment, medium
productive firms
engage in either exports or foreign direct
investment, and the least
productive firms focus only on the domestic market.
Moreover, exports and
foreign direct investment appear to improve firm
productivity once the
productivity convergence effect is controlled for. Firms
that retain a
presence in foreign markets, either by exports or
foreign direct
investment, show the highest productivity growth,
which contributes to
improvements in national productivity.
Yunfang Hu (Kobe
University), Kazuo Nishimura (Kyoto University), Koji Shimomura (Kobe
University)
“Three-Factor Models of International Trade”
Asia-Pacific
Journal of Accounting and Economics
<simomura@rieb.kobe-u.ac.jp>
Based on the Jones (1971) model, we
construct two dynamic models of international trade in which the
rate of time preference is either constant or
time-varying. The main purpose is to study whether and
under what conditions the results derived from
the Jones model still hold in the dynamic framework. It
is shown that the results of dynamic models
may be similar or different to those obtained in the static
model. For example, it is possible that, in both
static and dynamic models, an increase in a commodity
price raises this commodity's output and the rate
of return to the specific factor in this sector.
However, the effect on the wage rate may be
different due to the factor accumulation impact in the
dynamic framework.
Junko
Doi (Kansai University/Kyoto Sangyo University), Kazumichi Iwasa (Kobe University),
and Koji Shimomura (Kobe University)
“Indeterminacy in the free-trade world”
Journal of Difference
Equations and Applications
<simomura@rieb.kobe-u.ac.jp>
We
show that indeterminacy arises in a discrete-time competitive two-
country
dynamic model of international trade in which international fac-
tor
immobility, externalities, imperfect competition, and government in-
tervention
are assumed away. The present model is a standard dynamic
trade
model in the sense that there is neither an international credit mar-
ket
nor international factor mobility, and these intrinsic features make
an equilibrium
path generally Pareto-suboptimal and a source of inde-
terminacy.
While indeterminacy is derived only for " knife-edge"
in the
literature,
it is derived when parameters belong to a "positie-measure"
set.
Moreover,
the condition for indeterminacy is implied by the condition for
the existence of a
steady state.
Naoto Jinji
(Okayama University)
"International Trade and Renewable Resources under Asymmetries of Resource
Abundance and Resource Management"
Environmental and Resource Economics
<jinji 'at' e.okayama-u.ac.jp>
This paper examines the interaction between relative resource abundance and resource
management regimes in determining trade patterns and gains from trade in a
two-country model with a renewable resource. A model developed by Brander
and Taylor (1997b) is extended. It is shown that relative resource
abundance determines trade patterns if resource abundance is similar in both
countries and the relative demand for the resource good is moderate, or if
resource abundance is sufficiently different and the relative demand is not so
high. Otherwise, a difference in resource management regimes determines
trade patterns. Even under an open-access regime, the resource-scarce
country gains from trade unless resource abundance is similar and the relative
demand is low.
September 2006
Tsuyoshi Toshimitsu
(Kwansei Gakuin University)
“Effect of a Tariff on the Environment and
Welfare: The Case of an Environmental Differentiated
Duopoly in a Green Market”
Japan
and The World Economy
<ttsutomu@kwansei.ac.jp>
Employing a model of environmental quality-differentiated
products, we analyze the effect of an ad
valorem tariff on the unit emission level of the
products, the environment, and social welfare in the
Bertrand and the Cournot
duopoly cases, respectively. We show that the effect of the tariff policy
depends on the mode of market competition and the
degree of marginal social valuation of environmental
damages.
Akihiko
Yanase (Takasaki City University of Economics)
"Dynamic Games of Environmental Policy in a Global Economy: Taxes versus Quotas"
Review of International Economics
<yanase@tcue.ac.jp>
The effects of environmental policy on the global
environment as
an international public good with a stock
externality and national
welfare are examined in a model with trade in
a polluting commodity.
The
welfare effects of environmental policy, decomposed into terms
of trade, abatement cost and
environmental damage effects, induce
governments to adopt a strategic use of their
policy measures.
In
the absence of international cooperation on environmental policy,
it is demonstrated that the emission tax
game brings about larger
strategic distortions than the emission quota
game.
Kenji Fujiwara (Kwansei
Gakuin University)
“Trade patterns in an international mixed
oligopoly”
Economics
Bulletin
<kenjifujiwara@kwansei.ac.jp>
Developing a two-country model of
international mixed oligopoly,
this note makes clear the determinant of trade
patterns. We give
a simple formula to predict bilateral
patterns of trade which relates
the degree of a country's privatization to the
trading country's
competitiveness. If a semi-public firm is not sufficiently
privatized
in a country, this country exports the
non-competitive good.
August 2006
Yuqing Xing (International University of Japan)
"Strategic Environmental Policy and
Environmental Tariffs"
Journal
of Economic Integration
<xing@iuj.ac.jp>
This paper uses a three-stage game to
analyze how environmental tariffs
affect the strategic behavior of a government in
designing environmental
policy. The game is based on an international
duopoly model with
detrimental externality in production and asymmetric
environmental
policies between two countries. It shows that the
welfare effect of the
foreign country's strategic environmental policy on
the home country is
ambiguous. In the circumstance that the home country
would be worse off
due to the lenient environmental policy of the
foreign country, there
exists an optimal environmental tariff. If the
home country imposes the
optimal tariff on the pollution-intensive imports,
any deviation from
the first best environmental policy by the
foreign country would make
the home country better off. In addition, the
implementation of the
environmental tariff would mitigate the motivation of the
foreign
country to pursue strategic environmental policy,
and drive the lenient
environmental standard toward the efficient level. The
theoretical
results imply that, in an open economy with
non-harmonized environmental
standards, imposing environmental tariffs on imports
from the countries
with lax environmental regulations would correct
the adverse welfare
effect, and more importantly induce the upward
harmonization on
environmental policy across countries.
July 2006
Shigeto Kitano (Wakayama University)
“Capital Controls, Public Debt and Currency
Crises”
Journal
of Economics
<kitano@eco.wakayama-u.ac.jp>
This paper examines the possibility that
contrary to conventional
wisdom, capital controls accelerate currency
crises. Theoretical
analysis shows that capital controls can constitute
an additional burden
on government budget and so bring forward the
onset of crises. Since
perfect capital mobility does not occur, domestic
interest rates may
deviate from world interest rates. High interest
rates under capital
controls create an additional cost of servicing
outstanding domestic
public debt, precipitating crises. Even though the
government can delay
crises with capital controls, welfare may be worse
than in a situation
with perfect capital mobility.
Koji Shimomura (Kobe University) and Dipankar Dasgupta (Indian
Statistical Institute)
"Public Infrastructure, Employment and
Sustainable Growth in a Small Open Economy with and Without Foreign Direct
Investment"
Journal
of International Trade and Economic Development
<simomura@rieb.kobe-u.ac.jp>
The paper builds a theoretical model of
endogenous growth motivated by the recent Indian
paradox
of an improving GDP growth rate in the face of unsatisfactory employment
growth
rate. The source of the problem is believed to be inadequate growth of
manufacture
for
the absorption of unskilled or semi-skilled labour in
rural sectors. The paper studies
the
impact of free trade on employment and GDP growth in a small, developing economy
in
the absence as well as presence of foreign direct investment. The model also
recognizes
the importance of public infrastructure accumulation to support the growth
process.
The results indicate that free trade with or without a corresponding free inflow
of
foreign capital into the manufacturing sector has a positive impact on
employment and
GDP growth.
However, the beneficial effect is stronger in the presence of foreign capital.
Foreign and domestic capital
grow at equal rates in equilibrium.
Yushi
Yoshida (Kyushu Sangyo University) and Hiro Ito
(Portland State University)
“How do the Asian Economies Compete with
Japan in the US Market? Is China Exceptional? A Triangular Trade Approach”
Asia Pacific
Business Review
<yushi@ip.kyusan-u.ac.jp>
We apply a trilateral trade approach on
how Japanese exports and investment to China, or seven other Asian economies,
affect Chinese, or seven Asian economies’, exports to the US market. The
results suggest that while Chinese and Japanese exports are directly competitive
in US markets, Chinese exports to the US are supported partly by Japanese
exports to China. The positive correlation between Japanese exports to China
and Chinese exports to the US is explained by vertical trade between Japanese
multinationals and their affiliates in China. Indonesian and Philippine exports
are also competing with Japanese exports in US markets, though the extent of
the competition is much higher for China than for these countries.
June 2006
Jota Ishikawa (Hitotsubashi
University) and Hiroshi Mukunoki (Gakushuin
University)
"Effects of Multilateral Trade
Liberalization on Prices"
Review
of International Economics
To analyze the effects on prices of
simultaneous tariff reductions by
multiple importing countries, we construct a simple three-country
model
where a good is produced by a monopolist with
non-constant marginal cost
and imported by two countries. We specifically
compare two
representative tariff-reduction formulas: the
"fixed-amount" and the
"uniform
percentage" reductions. The uniform percentage reductions may
increase the consumer price in the importing country
whose initial
tariff is lower. Thus, importing countries with
relatively low tariffs
may prefer a bilateral trade agreement to a
multilateral one to ensure
consumer gains.
Hyun-soo Ji (DAVA Co.LTD.) and Ichiroh Daitoh (Tohoku
University)
"Interconnection Agreement between
Internet Service Providers and the Optimal Policy Intervention:
The Case of Cournot-type
Competition under Network Externalities"
Japanese Economic Review
We derive the optimal subsidy policy for
an interconnection agreement between two symmetric ISPs competing a la Cournot in a network service market. The interconnection
quality agreed upon is lower than the socially optimal level, as suggested by Crémer, Rey and Tirole (2000). In the basic model where both ISPs compete
in the domestic market, the optimal investment subsidy rate depends positively
on the strength of network externalities. In the extended model where home and
foreign ISPs compete in the home market, the optimal subsidy rate for the home
government is higher than in the basic model.
May 2006
Murray
C. Kemp (Maquarie University) and Koji Shimomura
(Kobe University)
"Optimal
commodity taxation with a representative agent"
Review of Development Economics
<simomura@rieb.kobe-u.ac.jp>
It is
argued that the task of describing the optimal vector of commodity taxes is
trivialized by the
traditional assumption of a price-taking representative
agent; that, in particular, the assumption of a
representative agent ensures that the null vector is
optimal.
Junko Doi (Kansai University), Kazuo Nishimura (Kyoto University)
and Koji Shimomura (Kobe University)
"A
two-country dynamic model of international trade and endogenous growth:
multiple balanced growth
paths and stability"
Journal of Mathematical Economics
<simomura@rieb.kobe-u.ac.jp>
We
formulate a two-country endogenous growth model which explain joint determination
of long-run trade
patterns and world growth rates. After providing the
existence and local stability of the continuum of
balanced growth paths, we show that main standard
trade propositions hold under some modifications and
that, subject to certain conditions concerning
social and private rankings of factory intensities
between production sectors, the higher is the
growth rate, the smaller is the volume of international
trade among balanced growth paths in the
continuum.
Toru
Kikuchi (Kobe University), Koji Shimomura (Kobe University) and D.-Z Zeng (Kagawa University)
"On
Chamberlinian-Ricardian Trade Patterns"
Review of International Economics
<kikuchi@econ.kobe-u.ac.jp>
This
study provides a simple, many-industry model of trade which emphasizes the
interaction between
cross-country technical heterogeneity (i.e., a Ricardian aspect) and monopolistic competition among
producers of differentiated products (i.e., a Chamberlinian aspect) as determinants of trade patterns. It
is shown that the emergence of intra-industry
trade is crucially dependent on the shape of the
technology index schedule, which is obtained as a
step-function.
Kazuo Mino (Osaka University)
"Voracity
vs. Scale Effect in a Growing Economy without Secure Property Rights"
Economics Letters
<mino@econ.osaka-u.ac.jp>
This
paper extends the standard model of growth with insecure property
rights by introducing variable labor supply and
increasing returns to
scale. It is assumed that capital stock is
jointly owned by multiple
interest groups and that each group participates
production activities
by supplying its labor force. In this setting,
there are two opposing
factors that affect growth: over consumption in the
absence of secure
property rights and the scale effect due to the
presence of increasing
returns. The growth performance of the economy thus
depends on which
factor dominates.
Jun-ichi Itaya (Hokkaido University)
and Kazuo Mino (Osaka University)
"Technology,
Preference Structure, and the Growth Effect of Money Supply"
Macroeconomic Dynamics
<mino@econ.osaka-u.ac.jp>
This
paper studies the growth effect of money supply in the presence of increasing
returns and endogenous labor supply. By using a
simple model of endogenous growth
with a cash-in-advance constraint, it is shown
that the growth effect of money supply
is closely related to the specifications of
preference structures as well as production
technology. If the production technology exhibits
strong non-convexity or if the utility
function has a high elasticity of intertemporal substitution, then there may exist dual
balanced-growth equilibria and
the impact of a change in money growth depends on which
steady state is realized in the long run. If the intertemporal substitutability in
felicity is higher than one, the balanced growth
equilibrium is uniquely given. However,
again, the effect of money supply on growth
depends on the degree of increasing returns
in production.
April
2006
Takeshi
Ikeda (Kobe International University)
"Does a tariff really enhance welfare?"
Japan and the World Economy
<ikeda@kobe-kiu.ac.jp>
Tanaka (1993) argues the small reciprocal tariff reduces the average costs of
firms and enhances the world welfare under a free entry Cournot
oligopoly with increasing returns to scale. This paper shows the welfare
improving effect which was found in Tanaka (1993) results from the relaxation
of the excess entry. We also find, however, such a world welfare enhancing
tariff is not valid because of the instability of the Cournot
solution. It indicates that we must take great care about the stability in
using the Cournot oligopoly model with increasing
returns to scale.
Laixun Zhao (Kobe U.) and Yuqing Xing (International Univ. of Japan)
"Global Production and Currency Devaluation"
Review of International Economics
Laixun Zhao (Kobe U. ) and Kenji Kondoh (Chukyo U.)
"Temporary and Permanent Immigration under Unionization"
Review of Development Economics
Yunfang Hu (Kobe University), Koji Shimomura (Kobe University)
This paper examines a two-country dynamic general equilibrium model with
status-seeking agents.
We show that the introduction of status-seeking behavior brings about new
properties in equilibrium
dynamics. While there exists a continuum of steady states in the standard
dynamic models, the present
framework demonstrates that, under some conditions, there uniquely exists an
incompletely specialized
steady state, which is locally saddle-point stable. Therefore, catching-up and
overtaking phenomena
seen in economic development can be explained, and comparative statics analysis also is made possible.
Our comparative statics analysis illustrates, for
example, that trade pattern is determined in the Heckscher-
Ohlin manner; the patient country acts just like a
capital abundant one to export the capital-intensive good.
Furthermore, as distinct from the existing literature, the present study shows
that the existence of
an incompletely specialization steady state can be ensured even if the two
countries conduct different policies.
Jota
Ishikawa (Hitotsubashi University) and Hiroshi Mukunoki (Gakushuin University)
"Spillover Effects of Economic Integration in a Three-Country Model"
Japanese Economic Review
Using a simple monopoly model, we examine the effects of economic
integration.
We show that the number of markets and the shape of marginal revenue curves are
crucial to evaluate economic integration when the marginal cost is not
constant.
The effects of tariff-reductions in a three-country model are in contrast with
those in a two-country model. The effects also depend on what trade policy
the non-member country adopts. When both importing countries simultaneously
lower their tariffs, the Metzler paradox may arise.
Chi
Young Choi (University of New Hampshire) and Kiyoshi
Matsubara (Nagoya City University)
“Heterogeneity in the Persistence of Relative Prices: What Do the Japanese
Cities Tell Us?”
Journal of the
Japanese and International Economies
<CY.Choi@unh.edu> <matubara@econ.nagoya-cu.ac.jp>
This paper employs diverse measures of persistence to analyze the
convergence speed of intercity relative prices in Japan using consumer
price subindices during 1970-2002. Regardless of the persistence measures,
the median estimated half-lives are found to be less than two years in the
vast majority of CPI items considered, which is compatible with economic
models based on price rigidities. However, there exists a large
heterogeneity in the persistence not just between tradables
and
nontradables items as is widely known, but within the
categories of
tradables or nontradables.
The heterogeneity is substantive across cities
in each CPI item as well. Our findings are robust to a subsample
analysis
though it points toward a presence of structural change around 1985. We
conjecture that the extent of heterogeneity across CPI items is linked to
the degree of tradability and market structure, while physical distance and
relative city size may play some roles in the heterogeneity across cities.
March
2006
Kenji
Fujiwara (Kobe University)
"Why Resisting Globalization Can be Reasonable"
Economics Bulletin
why there have been persistent anti-trade-liberalization movements. It is shown
that all of a country's
residents lose from trade under certain conditions on the cross-country cost
structure.
Rui Ota (Johns Hopkins University)
"Adjustability
in Production and Dynamic Effects of Domestic Competition Policy"
Journal of
International Trade and Economic Development
<rui.ota@jhu.edu>
This
study explores the effect on trade balance of suppressing competition in
domestic non-tradable sector
through the interaction between the short-run adjustment and the long-run
adjustment in production process.
Constructing a model that can capture a more short-run aspect than Yano (2001),
this study demonstrates
that the effect depends on the factor intensity ranking between the tradable
sector and the non-tradable sector.
In this model, a change in the price of the tradable good at time 0 plays an
important role to explain this result.
Jota Ishikawa (Hitotsubashi University)
and Tomohiro Kuroda (Nagoya Gakuin University)
"How effective are emission taxes in an open economy?"
Review of Development Economics
This paper compares emission taxes with other taxes from the
viewpoint of emission reduction
in an open economy. Using a simple monopoly model, we show that emission taxes
may not be
very effective to protect environment because of the spillover effects between
markets stemming
from non-constant marginal costs and transboundary
externalities. Other taxes such as production
taxes and tariffs are more effective under certain conditions. Thus, an easy
application of emission
taxes should be discreet in the open economy framework.
Naoto
Jinji (Okayama University) and Tsuyoshi Toshimitsu (Kwansei Gakuin University)
"Optimal Policy for Product R&D with Endogenous Quality Ordering:
Asymmetric Duopoly"
Australian Economic Papers
<jinji@e.okayama-u.ac.jp>
We examine the optimal R&D subsidy/tax policy
under a vertically
differentiated duopoly. In a significant departure from the existing
work, we consider the case of asymmetric costs of product R&D where
there is a small technology gap between firms. In our analysis, the
endogeneity of quality ordering is explicitly taken
into account. We
demonstrate the possible anti-leapfrogging effect of R&D
subsidy/tax policy. By committing to a firm-specific subsidy
schedule contingent on firms' quality choices, the government can
not only correct distortions in product quality but also select the
socially preferred equilibrium. The latter role is fulfilled by
preventing the technologically inferior firm from becoming a quality
leader in the industry. Both Bertrand and Cournot
cases are analyzed.
Toru
Kikuchi (Kobe University) and Koji Shimomura (Kobe University)
"On dynamic Chamberlin-Heckscher-Ohlin trade
patterns"
Economics Bulletin
Applying Atkeson and Kehoe's (2000) dynamic model to
the dynamic
Chamberlin-Heckscher-Ohlin approach,
we examine the role of timing of
development (e.g., removal of trade barriers) as a determinant of trade
patterns.
February
2006
Toru
Kikuchi (Kobe University) and Koji Shimomura (Kobe University)
"A two-country dynamic model with endogenous time preferences"
Keio Economic Studies
This paper formulates a two-country by two-factor by two-good dynamic
general equilibrium model of international trade with endogenous time
preferences. After proving the existence, uniqueness and local
saddlepoint stability of the steady state, we apply
the present dynamic
model to a trade issue concerning international technology transfer in
order to show that the effect of once-for-all technology transfer
upon
the donor country may differ between the dynamic model and the
standard
static Heckscher-Ohlin model.
Makoto
Yano (Keio University) and Fumio Dei (Kobe University)
"Network Externalities, Lexicographic Demand Shifts, and Marginal Cost
Dumping"
Keio Economic Studies
In many cases, dumping involves a massive demand shift from domestic products
to competing foreign products that are newly introduced to the domestic market.
This study presents a new way of modelling such a
demand shift relating to network
externalities and demonstrates that the monopolistic supplier of a new product
may
sell at a price below the marginal cost. This result provides a
new explanation for
what may be called marginal cost dumping.
January
2006
Toru
Kikuchi (Kobe University) and Koji Shimomura (Kobe University)
"A New Dynamic Trade Model of Increasing
Returns and Monopolistic
Competition"
Review of Development Economics
This
paper formulates a two-country by two-factor by two-good dynamic
Chamberlin-Heckscher-Ohlin model of
international trade with endogenous time preferences. After
proving the existence, uniqueness and local saddlepoint-stability of the steady state, we examine the
relationship between initial factor endowment and
trade patterns in the steady state.
It
will be shown that (i) given that the representative
household in each country supplies an equal
amount of labor, only intra-industry trade
occurs in the steady state and (ii) other things being equal,
the country with higher labor efficiency becomes the net
exporter of the labor-intensive good.