International R&D collaboration networks and free trade agreements

This thesis contributes to the analysis of optimal industrial and strategic trade policy in the presence of oligopoly and other forms of imperfect competition, so as to make contact with important empirical regularities and policy concerns, such as international R&D collaboration, unionization and free trade. First, in the context of international competition in which R&D plays an important role, we study the consequences of allowing governments to subsidize R&D and coalition deviation on the R&D collaboration networks. Then we investigate the formation of FTAs as a network formation game. While the analysis of welfare effects takes the central stage, we also analyze the nature of trading regimes that are consistent with the incentives of individual countries. We address the issue of conflict of interests among firms, consumers and governments as well. Finally, we integrate the analysis of international R&D collaboration and strategic trade policies, and demonstrate how an asymmetric equilibrium arises from an international trade model with symmetric countries and symmetric firms, and study whether it is sometimes possible to improve national welfare by jointly implementing trade and industrial policies.