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Political Ownership

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Author Info

  • Morten Bennedsen

    (Institute of Economics, University of Copenhagen)

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    Abstract

    Political involvement in the operation of an enterprises, whether it is private or state owned, creates opportunities for interest groups to influence the allocation of resources. I analyze how the influence externality arising form the interest groups´lobby activities disables the Coase Theorem. Then I proceed to investigate how the allocation of property rights between a government and a group of private owners determines the equilibrium allocation of resources in a firm. In other word, I provide a theory of why ownership matters.

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    Bibliographic Info

    Paper provided by University of Copenhagen. Department of Economics. Centre for Industrial Economics in its series CIE Discussion Papers with number 1998-17.

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    Length: 20 pages
    Date of creation: Oct 1998
    Date of revision:
    Publication status: Published in: Journal of Public Economics, 76(3), June 2000, 559-581
    Handle: RePEc:kud:kuieci:1998-17

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    Web page: http://www.econ.ku.dk/cie/
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    Related research

    Keywords: ownership structure; influence externally; resource allocation; Coase theorem;

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    Cited by:
    1. Andrei Shleifer, 1998. "State Versus Private Ownership," NBER Working Papers 6665, National Bureau of Economic Research, Inc.

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