In the presence of output subsidization, the optimal output subsidy is identical and profits, output and social welfare are also identical irrespective of whether (i)a public firm moves simultaneously with n private firms or (ii) it acts as a Stackelberg leader or (iii) all firms, public and private, behave as profit-maximizers.
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Article provided by Economics Bulletin in its journal Economics Bulletin.
Find related papers by JEL classification: L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
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