International Competition between Public or Mixed Enterprises
AbstractWe develop a model in which two firms from different countries compete on each other domestic market. Each firm is jointly owned by the residents and the government of its country. The extent of the government's stake in the public enterprise is endogenous and it determines the weight given to domestic consumers' surplus in the firm's payoff function. We show that the choice of each government's stake depends on a trade-off between allocative efficiency on the domestic market and profitability of foreign markets. We also highlight the fact that the government's stake in one country has an impact on firms' behavior in both countries.
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Bibliographic InfoPaper provided by Université Laval - Département d'économique in its series Cahiers de recherche with number 0301.
Date of creation: 2003
Date of revision:
Regulation; public enterprises; duopoly;
Other versions of this item:
- Bernard, Jean-Thomas & Dupéré, Marc & Roland, Michel, 2003. "International Competition Between Public or Mixed Enterprises," Cahiers de recherche 0301, GREEN.
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-04-13 (All new papers)
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