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Cheng, L. K. (1988). Assisting Domestic Industries under International Oligopoly: The Relevance of the Nature of Competition to Optimal Policies. The American Economic Re-view, 78, 746-758.
http://www.jstor.org/stable/1811172

has been cited by the following article:

• TITLE: Strategic Trade Policy and Location of the Upstream Firm

  AUTHORS: Yun-Ru Li, Chien-Hui Lee, Jen-Yao Lee

  KEYWORDS: Location, Strategic Trade Policy, Tariff, Subsidy

  JOURNAL NAME: American Journal of Industrial and Business Management, Vol.16 No.4, April 23, 2026

  ABSTRACT: This paper examines how the location of the upstream firm shapes optimal trade policy in a vertically related industry. Following the framework of Bernhofen (1997), when the upstream firm is located inside or outside the exporting country, trade policy affects welfare not only through horizontal competition in the final-good market but also through vertical interactions with an upstream firm possessing market power. In such a setting, export policies (tariffs or subsidies) influence the derived demand elasticity faced by the upstream firm, thereby altering its pricing behavior and the allocation of rents across countries.