DP2669 | Market Structure, Trade Liberalization, and the GATS

Publication Date

30/01/2001

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Abstract

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.