A Structural Model for Evaluating
نویسندگان
چکیده
This paper develops and estimates a structural model of imperfect competition in international markets. The model incorporates a flexible non-linear demand framework with structural price equations, and a general Conjectural Variation approach is developed to characterize strategic interaction. The model is used to evaluate the effects of the signature by a small open economy, Lebanon, of a Preferential Trade Agreement (PTA) with Egypt. Using highly disaggregated trade data and concentrating on the Iron and Steel products, it is shown that the estimated trade creation and/or diversion effects following a PTA are different under the structural approach compared to a reduced form or demand only approach.
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