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Huck, Steffen
Konrad, Kai A.
Year of Publication: 
Series/Report no.: 
CESifo Working Paper 948
We study the profitability incentives of merger and the endogenous industry structure in a strategic trade policy environment. Merger changes the strategic trade policy equlilibrium. We show that merger can be profitable and welfare enhancing here, even though it would not be profitable in a laissez-faire economy. A key element is the change in the governments. incentives to give subsidies to their local firms. National merger induces more strategic trade policy, whereas international merger does not.
merger incentives
strategic trade policy
Document Type: 
Working Paper

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