IDEAS home Printed from https://ideas.repec.org/a/eee/ecmode/v122y2023ics0264999323000597.html
   My bibliography  Save this article

Workers’ firm in mixed duopoly

Author

Listed:
  • Delbono, Flavio
  • Lanzi, Diego
  • Reggiani, Carlo

Abstract

Cooperatives, including those owned and run by workers (Workers Firms, WFs), compete with capitalist firms in oligopolistic industries (mixed oligopolies). We rationalize several facts emerging from the empirical research as: The concern of WFs for their employment; the interplay between membership and workplace safeguard within WFs; the different reaction to shocks between WFs and capitalist enterprises. We do so by means of a new model of WFs’ short-run behavior in a mixed duopoly. We innovate in modeling the WF’s objective function by including both profits and employment, and characterize the resulting Nash equilibrium.

Suggested Citation

  • Delbono, Flavio & Lanzi, Diego & Reggiani, Carlo, 2023. "Workers’ firm in mixed duopoly," Economic Modelling, Elsevier, vol. 122(C).
    • Handle: RePEc:eee:ecmode:v:122:y:2023:i:c:s0264999323000597
    DOI: 10.1016/j.econmod.2023.106247
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0264999323000597
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.econmod.2023.106247?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Burdín, Gabriel & Dean, Andrés, 2012. "Revisiting the objectives of worker-managed firms: An empirical assessment," Economic Systems, Elsevier, vol. 36(1), pages 158-171.
    2. Mai, Chao-Cheng & Hwang, Hong, 1989. "Export subsidies and oligopolistic rivalry between labor-managed and capitalist economies," Journal of Comparative Economics, Elsevier, vol. 13(3), pages 473-480, September.
    3. Arturo Garcia & Mariel Leal & Sang-Ho Lee, 2018. "Optimal policy mix in an endogenous timing with a consumer-friendly public firm," Economics Bulletin, AccessEcon, vol. 38(3), pages 1438-1445.
    4. Craig, Ben & Pencavel, John, 1992. "The Behavior of Worker Cooperatives: The Plywood Companies of the Pacific Northwest," American Economic Review, American Economic Association, vol. 82(5), pages 1083-1105, December.
    5. Flavio DELBONO & Carlo REGGIANI, 2013. "Cooperative Firms And The Crisis: Evidence From Some Italian Mixed Oligopolies," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 84(4), pages 383-397, December.
    6. Sumi Cho & Sang-Ho Lee, 2017. "Subsidization Policy on the Social Enterprise for the Underprivileged," Korean Economic Review, Korean Economic Association, vol. 33, pages 153-178.
    7. Flavio DELBONO & Luca LAMBERTINI, 2016. "Horizontal Mergers With Capital Adjustment: Workers Cooperatives And The Merger Paradox," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 87(4), pages 529-539, December.
    8. Miyazaki, Hajime & Neary, Hugh M, 1985. "Output, Work Hours and Employment in the Short Run of a Labour-managed Firm," Economic Journal, Royal Economic Society, vol. 95(380), pages 1035-1048, December.
    9. Cremer, Helmuth & Cremer, Jacques, 1992. "Duopoly with employee-controlled and profit-maximizing firms: Bertrand vs Cournot competition," Journal of Comparative Economics, Elsevier, vol. 16(2), pages 241-258, June.
    10. Burdín, Gabriel & Dean, Andrés, 2009. "New evidence on wages and employment in worker cooperatives compared with capitalist firms," Journal of Comparative Economics, Elsevier, vol. 37(4), pages 517-533, December.
    11. Cecilia NAVARRA, 2016. "Employment Stabilization Inside Firms: An Empirical Investigation Of Worker Cooperatives," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 87(4), pages 563-585, December.
    12. Delbono, Flavio & Rossini, Gianpaolo, 1992. "Competition policy vs horizontal merger with public, entrepreneurial, and labor-managed firms," Journal of Comparative Economics, Elsevier, vol. 16(2), pages 226-240, June.
    13. Thibault Mirabel, 2021. "Past, present and future of empirical research on employee-owned firms: a structured literature review over 1970–2019," Post-Print hal-03274901, HAL.
    14. Kahana, Nava & Nitzan, Shmuel, 1989. "More on alternative objectives of labor-managed firms," Journal of Comparative Economics, Elsevier, vol. 13(4), pages 527-538, December.
    15. Vickers, John, 1985. "Delegation and the Theory of the Firm," Economic Journal, Royal Economic Society, vol. 95(380a), pages 138-147, Supplemen.
    16. Ben Craig & John Pencavel, 1995. "Participation and Productiviy: A Comparison of Worker Cooperatives and Conventional Firms in the Plywood Industry," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1995 Micr), pages 121-174.
    17. Guido Caselli & Michele Costa & Flavio Delbono, 2022. "What do cooperative firms maximize, if at all? Evidence from Emilia‐Romagna in the pre‐Covid decade," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 93(4), pages 821-847, December.
    18. John Pencavel, 2013. "Worker cooperatives and democratic governance," Chapters, in: Anna Grandori (ed.), Handbook of Economic Organization, chapter 24, Edward Elgar Publishing.
    19. Bonin, John P & Jones, Derek C & Putterman, Louis, 1993. "Theoretical and Empirical Studies of Producer Cooperatives: Will Ever the Twain Meet?," Journal of Economic Literature, American Economic Association, vol. 31(3), pages 1290-1320, September.
    20. de Fraja, Giovanni & Delbono, Flavio, 1990. "Game Theoretic Models of Mixed Oligopoly," Journal of Economic Surveys, Wiley Blackwell, vol. 4(1), pages 1-17.
    21. William Fellner, 1947. "Prices and Wages under Bilateral Monopoly," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 61(4), pages 503-532.
    22. Andrea Cori & Mattia Granata & Keti Lelo & Salvatore Monni, 2021. "Mapping cooperatives in Italy," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 8(3), pages 136-163, March.
    23. Delbono, Flavio & Lambertini, Luca, 2014. "Cartel size and collusive stability with non-capitalistic players," Economics Letters, Elsevier, vol. 125(2), pages 156-159.
    24. Cho, Sumi & Lee, Sang-Ho, 2017. "Endogenous Private Leadership under Subsidy Policy on the Social Enterprises," MPRA Paper 83431, University Library of Munich, Germany.
    25. Horowitz, Ira, 1991. "On the effects of cournot rivalry between entrepreneurial and cooperative firms," Journal of Comparative Economics, Elsevier, vol. 15(1), pages 115-121, March.
    26. Peter J. Law, 1977. "The Illyrian Firm And Fellner'S Union‐Management Model," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 4(1), pages 29-37, January.
    27. de Fraja, Giovanni & Delbono, Flavio, 1989. "Alternative Strategies of a Public Enterprise in Oligopoly," Oxford Economic Papers, Oxford University Press, vol. 41(2), pages 302-311, April.
    28. Craig Ben & Pencavel John, 1993. "The Objectives of Worker Cooperatives," Journal of Comparative Economics, Elsevier, vol. 17(2), pages 288-308, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Flavio Delbono & Diego Lanzi & Carlo Reggiani, 2022. "Beyond Illyria: Workers' Firm in Mixed Oligopoly," Working Papers wp1170, Dipartimento Scienze Economiche, Universita' di Bologna.
    2. Guido Caselli & Michele Costa & Flavio Delbono, 2022. "What do cooperative firms maximize, if at all? Evidence from Emilia‐Romagna in the pre‐Covid decade," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 93(4), pages 821-847, December.
    3. Flavio DELBONO & Carlo REGGIANI, 2013. "Cooperative Firms And The Crisis: Evidence From Some Italian Mixed Oligopolies," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 84(4), pages 383-397, December.
    4. Flavio Delbono, 2016. "Le cooperative di produzione e la stabilit? occupazionale," QUADERNI DI ECONOMIA DEL LAVORO, FrancoAngeli Editore, vol. 2016(105), pages 166-177.
    5. Carlo Borzaga & Chiara Carini & Ermanno Celeste Tortia, 2022. "Co‐operative enterprise anti‐cyclicality and the economic crisis: A comparative analysis of employment dynamics in Italy," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 93(3), pages 551-577, September.
    6. Guillermo Alves & Gabriel Burdin & Paula Carrasco & Andrés Dean & Andrés Rius, 2012. "Empleo, remuneraciones e inversión en cooperativas de trabajadores y empresas convencionales: nueva evidencia para Uruguay," Documentos de Trabajo (working papers) 12-14, Instituto de Economía - IECON.
    7. Tortia, Ermanno C., 2021. "Employment protection regimes and dismissal of members in worker cooperatives," MPRA Paper 109214, University Library of Munich, Germany.
    8. Tortia, Ermanno Celeste, 2019. "Employment protection regimes in worker co-operatives: dismissal of worker members and distributive fairness," MPRA Paper 94536, University Library of Munich, Germany.
    9. Marina Albanese & Cecilia Navarra & Ermanno Tortia, 2019. "Equilibrium unemployment as a worker insurance device: wage setting in worker owned enterprises," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 36(3), pages 653-671, October.
    10. Dow,Gregory K., 2019. "The Labor-Managed Firm," Cambridge Books, Cambridge University Press, number 9781107589650, January.
    11. Gregory K. DOW, 2018. "The Theory Of The Labor-Managed Firm: Past, Present, And Future," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 89(1), pages 65-86, March.
    12. Marina Albanese, 2020. "Social and Relational Variables in Worker Cooperatives: Implications for the Objective Function," Journal of Entrepreneurial and Organizational Diversity, European Research Institute on Cooperative and Social Enterprises, vol. 9(1), pages 26-44.
    13. Bennett, John & Estrin, Saul & Hare, Paul, 1999. "Output and Exports in Transition Economies: A Labor Management Model," Journal of Comparative Economics, Elsevier, vol. 27(2), pages 295-317, June.
    14. Gabriel Burdín, 2014. "Are Worker-Managed Firms More Likely to Fail Than Conventional Enterprises? Evidence from Uruguay," ILR Review, Cornell University, ILR School, vol. 67(1), pages 202-238, January.
    15. Burdín, Gabriel & Dean, Andrés, 2012. "Revisiting the objectives of worker-managed firms: An empirical assessment," Economic Systems, Elsevier, vol. 36(1), pages 158-171.
    16. Dean, Andrés, 2019. "Do successful worker-managed firms degenerate?," Journal of Comparative Economics, Elsevier, vol. 47(2), pages 317-329.
    17. Kazuhiro Ohnishi, 2022. "Lifetime Employment and Stackelberg Mixed Duopoly Games with a Foreign Labour-Managed Competitor," Arthaniti: Journal of Economic Theory and Practice, , vol. 21(1), pages 27-42, June.
    18. Kazuhiro Ohnishi, 2013. "A Two-production-period Model with State-owned and Labour-managed Firms," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 5(1), pages 41-56, April.
    19. Burdin, Gabriel, 2013. "Are Worker-Managed Firms Really More Likely to Fail?," IZA Discussion Papers 7412, Institute of Labor Economics (IZA).
    20. Virginie Pérotin, 2013. "Worker Cooperatives: Good, Sustainable Jobs in the Community," Journal of Entrepreneurial and Organizational Diversity, European Research Institute on Cooperative and Social Enterprises, vol. 2(2), pages 34-47, May.

    More about this item

    Keywords

    Workers’ firm; Labor-managed firms; Employment; Oligopoly;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • P13 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Cooperative Enterprises

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecmode:v:122:y:2023:i:c:s0264999323000597. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.