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Please use this identifier to cite or link to this item: http://ntour.ntou.edu.tw:8080/ir/handle/987654321/38639

Title: Big vs. Small under Free Trade: Market Size and Size Distribution of Firms
Authors: Yo-Yi Huanga;Deng-Shing Huang
Contributors: 國立臺灣海洋大學:應用經濟研究所
Keywords: Globalization;Home-market effect;Firm size;Cost advantage
Date: 2014-11
Issue Date: 2016-10-21T08:11:17Z
Publisher: International Review of Economics & Finance
Abstract: Abstract:In a two-country monopolistic competition general equilibrium model, we consider two types of firms: big with higher fixed cost but lower marginal cost, and small with lower fixed cost but with high marginal cost. We prove that free trade may not always benefit the big-country and/or big firms. The smaller country may take more than proportional market share after free trade in the big-firm and/or small-firm market, if the cost advantage dominates the disadvantage in the smaller home market. This result may explain the phenomenon of rising big-enterprises from the small emerging economies in the last decades. In addition, we also prove that an increase in the global market size may lead to more small-size firms, unless the elasticity of substitution is large enough.
Relation: 34, pp.175–189
URI: http://ntour.ntou.edu.tw:8080/ir/handle/987654321/38639
Appears in Collections:[應用經濟研究所] 期刊論文

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