Privatization and Government's Preference under Mixed Oligopoly: A Generalization
AbstractIn this paper, we generalize Kato's (Economics Bulletin, 2008) model by allowing many private firms in the mixed oligopoly setting, rather than the mixed duopoly framework of Kato (2008). By introducing the government's preference for tax revenues into the theoretical framework of mixed oligopoly, we show that Kato's results are robust when there are many private firms. That is, as the number of private firms increases, both total output and the government's payoff in the mixed oligopoly are larger than those in the private oligopoly if and only the weight of the government's preferences on tax revenues increases and vice versa.
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Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 29 (2009)
Issue (Month): 2 ()
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Government's preference; social welfare; tax; privatization;
Find related papers by JEL classification:
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
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- Matsumura, Toshihiro, 1998. "Partial privatization in mixed duopoly," Journal of Public Economics, Elsevier, vol. 70(3), pages 473-483, December.
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- de Fraja, Giovanni & Delbono, Flavio, 1989. "Alternative Strategies of a Public Enterprise in Oligopoly," Oxford Economic Papers, Oxford University Press, vol. 41(2), pages 302-11, April.
- Fjell, Kenneth & Heywood, John S., 2004. "Mixed oligopoly, subsidization and the order of firm's moves: the relevance of privatization," Economics Letters, Elsevier, vol. 83(3), pages 411-416, June.
- repec:ebl:ecbull:v:12:y:2002:i:1:p:1-6 is not listed on IDEAS
- White, Mark D., 1996. "Mixed oligopoly, privatization and subsidization," Economics Letters, Elsevier, vol. 53(2), pages 189-195, November.
- Mujumdar, Sudesh & Pal, Debashis, 1998. "Effects of indirect taxation in a mixed oligopoly," Economics Letters, Elsevier, vol. 58(2), pages 199-204, February.
- Joanna Poyago-Theotoky, 2001. "Mixed oligopoly, subsidization and the order of firms' moves: an irrelevance result," Economics Bulletin, AccessEcon, vol. 12(3), pages 1-5.
- Rudra Sensarma & Bibhas Saha, 2008. "The Distributive Role of Managerial Incentives in a Mixed Duopoly," Economics Bulletin, AccessEcon, vol. 12(28), pages 1-10.
- repec:ebl:ecbull:v:12:y:2008:i:40:p:1-7 is not listed on IDEAS
- Choi, Kangsik, 2009. "Government's Preference and Timing of Endogenous Wage Setting: Perspectives on Privatization and Mixed Duopoly," MPRA Paper 17221, University Library of Munich, Germany.
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