DP2669 Market Structure, Trade Liberalization, and the GATS

Author(s): Joseph Francois, Ian Wooton
Publication Date: January 2001
Keyword(s): Imperfect Competition, Market Access, Services Trade, Trade Liberalization
JEL(s): F12, F13, F23
Programme Areas: International Trade and Regional Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=2669

In this Paper we examine the interaction between the different modes of market access commitments in services (cross-border and establishment) market structure, and regulation. In this context, we focus on the impact of improved domestic market access for a foreign service provider on a domestic service market. We work with a model where the domestic industry is assumed to be imperfectly competitive and, as a result of domestic regulation, is able to act as a cartel. We also examine the incentives for the domestic firms to accommodate the entry of the foreign firm by inviting it to join the cartel.