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Industry Restructuring: A Case for Affirmative Action

Author

Listed:
  • Bertrand Villeneuve

    (LEDa - Laboratoire d'Economie de Dauphine - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres)

  • Vanessa Yanhua Zhang

    (Renmin University of China - Renmin University of China)

Abstract

We analyze the trade-off faced by authorities envisaging a one-shot structural re-form in a capitalistic industry. A structure is modeled as (1) a sharing of productive capital at some time and (2) a sharing of scarce sites or any other non-reproducible assets. These two distinct dimensions of policy illustrate the importance of a dy-namic theory in which firms durably differ in several respects. Though equalization of endowments and rights is theoretically optimal, realistic constraints force com-petition authorities to adopt second-best solutions. Affirmative action here is the policy that recognizes the fact that, under certain circumstances, helping the dis-advantaged contributes maximally to social surplus.

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  • Bertrand Villeneuve & Vanessa Yanhua Zhang, 2013. "Industry Restructuring: A Case for Affirmative Action," Post-Print hal-01685923, HAL.
    • Handle: RePEc:hal:journl:hal-01685923
    Note: View the original document on HAL open archive server: https://hal.science/hal-01685923
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    References listed on IDEAS

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