Duopolistic Competition and Optimal Switching Time from Export to Fdi in Uncertainty Cover Image

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Duopolistic Competition and Optimal Switching Time from Export to Fdi in Uncertainty / Mankan M. Koné.

Koné, Mankan M.. (Added Author). Tamini, Lota D.. (Added Author). Gaigné, Carl. (Added Author). Canadian Electronic Library (Firm) (distributor.).

Summary:

This paper aimed to extend previous real option models to features of multinational firms’ activities such as market competition and trade barriers. Few researchers have studied multinationals’ optimal switching time from export to FDI using real options, and those who have done so have ignored trade policies and strategic interactions between firms. Yet, the presence of local competitors and trade costs influences the option value of waiting. We find that FDI in host countries with uncertain demand, strong competition and few barriers to trade will likely to be delayed with respect to immediate investment. In terms of policy implications, we find that the trade and competition policies of host countries have lower deterrent effects on FDI when uncertainty is reduced.

Record details

ISSN: 1927-5544
Physical Description: 1 online resource (29 pages).
Publisher: Québec, QC, CA: Centre for Research on the Economics of the Environment, Agri-food, Transportation, and Energy, 2017.

Content descriptions

General Note:	Issued as part of the desLibris documents collection.
Restrictions on Access Note:	Access restricted to authorized users and institutions.
Type of Computer File or Data Note:	Electronic monograph in PDF format.
System Details Note:	Mode of access: World Wide Web.