Abstract:
We examine the setting of national competition policy in a two-country setting,emphasizing the relationship of trade to the goals of competition policy (suchas the degree and nature of competition). The issues we address involve thegeneral equilibrium distributional effects of competition policy, therelationship of national competition policy to terms-of-trade gains and losses,the implications of distinct national markets linked through trade (thestarting point for all trade theorists) for the analysis of national competitionpolicy, and the characteristics of the Nash equilibrium policy sets.