Please use this identifier to cite or link to this item:
|Title:||Opportunity cost, trade policies and the efficiency of firms|
|Citation:||Goh, A.-T. (2000). Opportunity cost, trade policies and the efficiency of firms. Journal of Development Economics 62 (2) : 363-383. ScholarBank@NUS Repository. https://doi.org/10.1016/S0304-3878(00)00089-4|
|Abstract:||This paper analyzes the effects of trade policies on the technological effort of a firm entering a new market in the context of a developing country. We depart from previous literature by bringing into focus the opportunity cost of technological effort. A firm that spends time in acquiring a more efficient technology delays the commercialization of its products, thus incurring an opportunity cost in terms of profits forgone. Protection increases both the opportunity cost and the benefits from technological effort. In the case of linear demand function and constant returns to scale technology, protection is shown to unambiguously reduce the protected firm's technological effort. Export subsidy is also shown to reduce technological effort when the potential level of exports under free trade is high. (C) 2000 Elsevier Science B.V. All rights reserved.|
|Source Title:||Journal of Development Economics|
|Appears in Collections:||Staff Publications|
Show full item record
Files in This Item:
There are no files associated with this item.
checked on Mar 20, 2019
WEB OF SCIENCETM
checked on Mar 11, 2019
checked on Mar 10, 2019
Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.