Article ID Journal Published Year Pages File Type
7349569 Economics Letters 2018 16 Pages PDF
Abstract
We investigate product quality in an import-competing country using the framework of vertical product differentiation. Comparison of three polices suggests that the quality-based R&D subsidy brings quality-reversal, leading to a win-win-win equilibrium in consumer surplus, domestic profit and social welfare.
Keywords
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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Import competition, product quality reversal, and welfare
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