@article{Vanzetti:313489,
      recid = {313489},
      author = {Vanzetti, David},
      title = {Trade Games: Noncooperative Strategies in the  International Wheat Market },
      address = {1989},
      number = {671-2021-2628},
      pages = {227},
      year = {1989},
      note = {PhD dissertation. La Trobe University, , Australia},
      abstract = {International commodity markets have most commonly been  analysed with the use of perfectly competitive models,  ignoring the effects of government intervention combined  with market power. Such models are unable to account for  retaliation and other strategic effects that have recently  been observed in wheat and other agricultural markets. In  this thesis, a framework is developed for analysing  strategic interactions in agricultural trade. Policymakers  set domestic prices to optimise weighted welfare functions,  where the weights reflect the relative influence of  consumers, producers and taxpayers. These weights are  estimated from observed domestic prices in each region.  Non-cooperative, game-theoretic equilibria are utilised to  determine the outcome of trade wars under various  scenarios. Cournot-Nash, Stackelberg and conjectural  variations solutions are obtained in a static framework.  The analysis is then extended to include lags in production  and decision making, and the strategic and dynamic elements  of the policymaker's problem are examined in a dynamic  difference game. Prices are set in each region to optimise  a quadratic objective function, subject to linear  intertemporal constraints. A dynamic programming approach,  using Riccati equations, is developed to solve for the  single controller problem. An iterative procedure is then  applied to take account of the interdependence of all  countries' policies. To incorporate storage in the  deterministic model, multi-period quadratic programming is  used to find the optimum tariffs and stock levels  simultaneously. This approach allows the restriction that  stocks must be non-negative. The analysis is applied to a  model of the international wheat market. The results  indicate that strategic behaviour can significantly  influence optimal trade policy, and hence prices, trade  flows and the distribution of welfare.},
      url = {http://ageconsearch.umn.edu/record/313489},
      doi = {https://doi.org/10.22004/ag.econ.313489},
}