Hideya Kato () (Faculty of Economics, Nagoya Keizai University, 61-1, Uchikubo, Inuyama, Aichi, 484-8504, Japan)
Abstract
This paper uses a mixed oligopoly model to examine the relationship between the privatization of a public firm and government preferences for tax revenue. From a public choice viewpoint, we assume the government prefers tax revenue to the sum of consumer and producer surplus, whereas the public firm only cares about the sum of consumer and producer surplus. The results indicate that if the government sufficiently prefers tax revenue, it will not privatize the public firm.
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Publisher Info
Article provided by Economics Bulletin in its journal Economics Bulletin.
Find related papers by JEL classification: L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise H2 - Public Economics - - Taxation, Subsidies, and Revenue
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