 |
The expansion of large companies across frontiers often leads to the phenomena of dumping and not always increases the profit of the companies due to antidumping duties. Here, we consider an economic model in which one firm has the monopoly of a certain market in its own country and divides another market in a foreign country with a firm of the foreign country. Assuming that both firms are cooperating in the foreign market, we study two possible strategies for the firm that is selling in both countries to increase its profit by deviating from collusion: one in which the firm increases the production in both countries and deviates without make dumping and other strategy in which the firm only increases the production in the foreign country and deviates committing dumping. To do our analysis we use an infinitely repeated duopoly model, and we characterize the parameters that define the most profitable strategy.
