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The Decision To Hire Managers In Mixed Markets Under Bertrand Competition

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  • JUAN CARLOS BÁRCENA‐RUIZ

Abstract

This paper analyses the decisions of firms as to whether or not to hire managers when there is a public firm competing with a private firm in the product market. It is shown that under Bertrand competition with heterogeneous goods both firms hire managers. This is in contrast with the result obtained under Cournot competition, where only the private firm hires a manager. Moreover, welfare is lower if both firms hire managers than if neither firm does. In contrast, under Cournot competition welfare is greater if both firms hire managers.

Suggested Citation

  • Juan Carlos Bárcena‐Ruiz, 2009. "The Decision To Hire Managers In Mixed Markets Under Bertrand Competition," The Japanese Economic Review, Japanese Economic Association, vol. 60(3), pages 376-388, September.
    • Handle: RePEc:bla:jecrev:v:60:y:2009:i:3:p:376-388
    DOI: 10.1111/j.1468-5876.2008.00455.x
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    Cited by:

    1. Yasuhiko Nakamura, 2019. "Combining the Endogenous Choice of the Timing of Setting the Levels of Strategic Contracts and Their Contents in a Managerial Mixed Duopoly," Journal of Industry, Competition and Trade, Springer, vol. 19(2), pages 235-261, June.
    2. Chang, Winston W. & Chen, Fang-yueh, 2016. "Strategic managerial delegation and industrial policy competition in vertically-related markets," International Review of Economics & Finance, Elsevier, vol. 43(C), pages 429-442.
    3. Michael Kopel & Marco A. Marini, 2012. "Optimal Compensation Structure in Consumer Cooperatives under Mixed Oligopoly," DIS Technical Reports 2012-06, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    4. Alessandra Chirco & Caterina Colombo & Marcella Scrimitore, 2014. "Organizational Structure and the Choice of Price versus Quantity in a Mixed Duopoly," The Japanese Economic Review, Japanese Economic Association, vol. 65(4), pages 521-542, December.
    5. Kadohognon Sylvain Ouattara, 2015. "Délégation stratégique dans un duopole mixte international," Economics Working Paper Archive (University of Rennes & University of Caen) 201518, Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS.
    6. Michael Kopel & Marco Marini, 2014. "Strategic delegation in consumer cooperatives under mixed oligopoly," Journal of Economics, Springer, vol. 113(3), pages 275-296, November.
    7. Michael Kopel & Marco A. Marini, 2012. "Optimal Compensation Structure in Consumer Cooperatives under Mixed Oligopoly," DIS Technical Reports 2012-06, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    8. Yasuhiko Nakamura, 2015. "Endogenous Choice of Strategic Contracts in a Mixed Duopoly with Bargaining Over Managerial Delegation Contracts," Australian Economic Papers, Wiley Blackwell, vol. 54(2), pages 121-134, June.
    9. Kadohognon S Ouattara, 2016. "How privatization affects the strategic choice of managerial incentives: the case of international mixed duopoly," Economics Bulletin, AccessEcon, vol. 36(2), pages 1038-1045.
    10. Yasuhiko Nakamura, 2017. "Endogenous market structures in a mixed oligopoly with a public firm whose managerial contract is based on welfare and bargaining over the managerial contract of a private firm," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 34(2), pages 189-209, August.
    11. Nakamura, Yasuhiko, 2019. "Combining the endogenous choice of the timing of setting incentive parameters and the contents of strategic contracts in a managerial mixed duopoly," International Review of Economics & Finance, Elsevier, vol. 59(C), pages 207-233.
    12. Alessandra Chirco & Caterina Colombo & Marcella Scrimitore, 2013. "Organizational Structure and the Choice of Price vs. Quantity in a Mixed Duopoly," Working Paper series 27_13, Rimini Centre for Economic Analysis.
    13. Luciano Fanti, 2017. "An Observable Delay Game with Unionised Managerial Firms," Scottish Journal of Political Economy, Scottish Economic Society, vol. 64(1), pages 50-69, February.
    14. Juan Carlos Barcena-Ruiz, 2010. "Strategic Delegation and Semipublic Firms," Economics Bulletin, AccessEcon, vol. 30(1), pages 744-750.
    15. Yasuhiko Nakamura, 2019. "Endogenous Choice of the Timing of Setting Incentive Parameters and the Strategic Contracts in a Managerial Mixed Duopoly with a Welfare-Based Delegation Contract and a Sales Delegation Contract," Journal of Industry, Competition and Trade, Springer, vol. 19(4), pages 679-737, December.

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