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Models of competition between one for-profit and one nonprofit firm

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  • Petra Brhlikova
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    Abstract

    To study the coexistence of two different ownership forms within anindustry, I develop a simple model of competition between one for-profit and one nonprofit firm. The two firms have different objectives and face different constraints due to their choice of ownership status. Assuming heterogenous consumers I derive quality-price bundles provided by the two firms and their market shares under various conditions.

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    File URL: http://www.cerge-ei.cz/pdf/wp/Wp240.pdf
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    Bibliographic Info

    Paper provided by The Center for Economic Research and Graduate Education - Economic Institute, Prague in its series CERGE-EI Working Papers with number wp240.

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    Date of creation: Oct 2004
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    Handle: RePEc:cer:papers:wp240

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    Keywords: Nonprofit firm; For-profit firm; Monopoly; duopoly; mixed industry.;

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    1. Daniel Kessler & Mark McClellan, 2001. "The Effects of Hospital Ownership on Medical Productivity," NBER Working Papers 8537, National Bureau of Economic Research, Inc.
    2. Henry Hansmann, 1981. "Nonprofit Enterprise in the Performing Arts," Bell Journal of Economics, The RAND Corporation, vol. 12(2), pages 341-361, Autumn.
    3. Leete, Laura, 2001. "Whither the Nonprofit Wage Differential? Estimates from the 1990 Census," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 136-70, January.
    4. Susan Rose-Ackerman, 1996. "Altruism, Nonprofits, and Economic Theory," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 701-728, June.
    5. Grabowski, David C. & Hirth, Richard A., 2003. "Competitive spillovers across non-profit and for-profit nursing homes," Journal of Health Economics, Elsevier, vol. 22(1), pages 1-22, January.
    6. Hirth, Richard A., 1999. "Consumer information and competition between nonprofit and for-profit nursing homes," Journal of Health Economics, Elsevier, vol. 18(2), pages 219-240, April.
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