Strategic Trade Policy

This volume is a collection of Jota Ishikawa's past and recent research on strategic trade policy. Chapters one and two are concerned with technical matters when studying strategic trade policy rather than the analysis of strategic trade policy itself. The chapters particularly introduce an innovative method of illustrating the Cournot-oligopoly equilibrium and the Cournot-oligopsony equilibrium on the price-quantity plane. Chapter three surveys the pioneering work by James A Brander and Barbara J Spencer and examines several points that are often overlooked or misunderstood when discussing theoretical models of strategic trade policy. Chapters four through six deal with market integration through trade liberalization in the context of strategic trade policy. It is shown that trade liberalization may generate unexpected effects. Chapters seven through nine investigate trade costs and trade policies in the presence of firm heterogeneity. Implications obtained in these chapters are different from those in the Melitz model. Chapters 10 and 11 are concerned with information about strategic trade policies. In particular, these chapters study what information is needed when employing strategic trade policies. Chapters 12 through 15 explore strategic trade policies with intermediate inputs. As global value chains develop, it is becoming increasingly important to analyze trade policies in vertical market structures.