Abstract
Different stability conditions in an oligopolistic trade model have nontrivial consequences for commercial policy. Applying Hahn's stability condition to an oligopolistic trade model, the received literature concludes that optimal noncooperative tariffs are positive and that noncooperative tariffs are higher than those obtained when economies containing the oligopolies are integrated. In the present paper, it is shown that less restrictive uniqueness conditions the Gale-Nikaido univalence condition and the still weaker Index uniqueness condition alter these results significantly. For certain empirical environments, the weak stability conditions allow us to justify non-intervention policy; and optimal trade policy can even include import subsidies for Nash-Cournot oligopolies.[F 12]
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