Property Rights and Market: Employee Privatization as a Cooperative Bargaining Process
AbstractThe paper presents a game-theoretic model in order to investigate to what extent an employee privatization program of a State owned firm can be feasible under certain assumptions concerning the players' objective functions and the market structure in which the firm operates. The public managers are assumed interested in the firm's value, while the workers aim at maximizing the per capita surplus over the wage. The privatization process is then described as a bargaining process between the government in the role of core investor in the firm's physical assets and the workers of the firm, whose only asset is their personal skill. In the model the market structure in which the firm sells its product is assumed to be imperfectly competitive. After presenting the case of a monopolistic firm, the paper explores what happens if the firm plays a duopoly quantity game. The final section is devoted to introducing to the analysis an x-efficiency cost proportional to the public share of the ownership.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 31870.
Date of creation: Feb 1996
Date of revision:
Publication status: Published in Economic Systems 4.20(1996): pp. 273-305
Bargaining; State-owned Firms; Privatization;
Other versions of this item:
- MARINI, Marco, 1996. "Property Rights and Market : Employee Privatization as a Cooperative Bargaining Process," CORE Discussion Papers 1996023, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Marini, M., . "Property rights and market: employee privatization as a cooperative bargaining process," CORE Discussion Papers RP -1252, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
- L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- J54 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Producer Cooperatives; Labor Managed Firms
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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"Property Rights and the Nature of the Firm,"
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- John Vickers & George Yarrow, 1991. "Economic Perspectives on Privatization," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 111-132, Spring.
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