Date of Graduation


Document Type


Degree Type



Chambers College of Business and Economics



Committee Chair

Subhayu Bandyopadhyay


This dissertation illustrates the effects of managerial delegation on strategic trade policies and the relationship between intra-industry trade and income convergence. In the first essay strategic trade policy under duopoly is investigated in a multistage game model with endogenous timing of trade policy. The analysis also includes the separation of ownership and management for each firm. The study is integrated in a single analytical framework. The results show that in the subgame perfect equilibrium of the trade policy game, the home government commits not to use countervailing duties: the home government sets its tariff and production subsidy at stage one and the foreign government sets its export subsidy at stage two. As a result both countries are better off when the home government is the Stackelberg leader. The second paper analyzes the relationship between international trade and income convergence among countries by focusing on groups of countries comprising major trade partners. For each country, primary intra-industry trade partners are determined and trade groups are created. The behavior of income differentials within these groups is examined. The majority of these intra-industry trade-based groups exhibit significant income convergence. The third paper provides recent evidence on determinants of the bilateral intra-industry trade in a multi-country & multi-industry framework. The empirical results show that the extent of intra-industry trade is positively correlated with average GNP, average GNP/capita, and the existence of a common border; and it is negatively correlated with difference in GNP, difference in GNP/capita, and distance. All the variables are highly significant statistically. The EU and NAFTA dummy variables have the expected positive sign and are highly significant statistically. The regression coefficients of the language dummy variables have a positive sign, but their level of statistical significance varies.