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Mixed Oligopoly and Environmental Policy

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  • Juan Bárcena-Ruiz

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  • María Garzón

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Abstract

The literature on mixed oligopoly does not consider the role that the environmental policy of the government plays on the decision whether to privatize public firms. Assuming that there are one public firm and n private firms and that the government chooses an environmental standard we show that, when the number of private firms is low enough, the public firm is privatized if it is inefficient enough. When the number of private firms is high enough, the government always privatizes the public firm. We also show that the range of values of the parameters for which the government privatizes the public firm is greater than when environmental policy is not considered.
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Suggested Citation

  • Juan Bárcena-Ruiz & María Garzón, 2006. "Mixed Oligopoly and Environmental Policy," Spanish Economic Review, Springer;Spanish Economic Association, vol. 8(2), pages 139-160, June.
  • Handle: RePEc:spr:specre:v:8:y:2006:i:2:p:139-160
    DOI: 10.1007/s10108-006-9006-y
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    References listed on IDEAS

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    Cited by:

    1. Wang, Leonard F.S. & Chen, Tai-Liang, 2011. "Mixed oligopoly, optimal privatization, and foreign penetration," Economic Modelling, Elsevier, vol. 28(4), pages 1465-1470, July.
    2. Kazuhiko Kato, 2011. "Emission quota versus emission tax in a mixed duopoly," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 13(1), pages 43-63, January.
    3. Philippe De Donder, 2005. "L'entreprise publique en concurrence : les oligopoles mixtes," Revue Française d'Économie, Programme National Persée, vol. 20(2), pages 11-50.
    4. Bárcena-Ruiz, Juan Carlos & Campo, María Luz, 2012. "Partial cross-ownership and strategic environmental policy," Resource and Energy Economics, Elsevier, vol. 34(2), pages 198-210.
    5. Maria José Gil-Moltó & Dimitrios Varvarigos, 2014. "Environmental Investments in Mixed vs Private Oligopoly: What are the Implications of Privatization?," Working Papers 2014018, The University of Sheffield, Department of Economics.
    6. Tai-Liang Chen & Leonard Wang, 2010. "Trade liberalization and transboundary pollution in an international mixed duopoly," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 12(4), pages 187-200, December.
    7. Rupayan Pal & Bibhas Saha, 2011. "Environmental outcomes in a model of mixed duopoly," University of East Anglia Applied and Financial Economics Working Paper Series 030, School of Economics, University of East Anglia, Norwich, UK..
    8. Rupayan Pal & Bibhas Saha, 2010. "Does partial privatization improve the environment," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2010-018, Indira Gandhi Institute of Development Research, Mumbai, India.
    9. Wang, Leonard F.S. & Wang, Jean, 2009. "Environmental taxes in a differentiated mixed duopoly," Economic Systems, Elsevier, vol. 33(4), pages 389-396, December.
    10. Gutierrez-Hita, Carlos & Martinez-Sanchez, Francisco, 2013. "Environmental Policy to Foster a Green Differentiated Energy Market," MPRA Paper 47263, University Library of Munich, Germany.
    11. Xu, Lili & Cho, Sumi & Lee, Sang-Ho, 2016. "Emission tax and optimal privatization in Cournot–Bertrand comparison," Economic Modelling, Elsevier, vol. 55(C), pages 73-82.
    12. Rupayan Pal & Bibhas Saha, 2014. "Mixed Duopoly and Environment," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 16(1), pages 96-118, February.
    13. Pal, Rupayan & Saha, Bibhas, 2015. "Pollution tax, partial privatization and environment," Resource and Energy Economics, Elsevier, vol. 40(C), pages 19-35.
    14. Jihad C. Elnaboulsi, 2015. "Environmental Regulation and Policy Design: The Impact of the Regulator?s Ecological Conscience on the Tax Setting Process," Working Papers 2015-11, CRESE.
    15. Tsai, Tsung-Hsiu & Wang, Chia-Chi & Chiou, Jiunn-Rong, 2016. "Can privatization be a catalyst for environmental R&D and result in a cleaner environment?," Resource and Energy Economics, Elsevier, vol. 43(C), pages 1-13.
    16. Jiancai Pi & Li Yang & Yu Zhou, 2013. "Privatization and environmental pollution in a mixed duopoly," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics, vol. 31(2), pages 163-192.
    17. Antelo, Manel & Loureiro, Maria L., 2009. "Asymmetric information, signaling and environmental taxes in oligopoly," Ecological Economics, Elsevier, vol. 68(5), pages 1430-1440, March.
    18. Shoji Haruna & Rajeev K. Goel, 2018. "Optimal Pollution Control in a Mixed Oligopoly with Research Spillovers," CESifo Working Paper Series 6909, CESifo Group Munich.

    More about this item

    Keywords

    Environmental tax; Mixed oligopoly; Privatization; L33; Q28;

    JEL classification:

    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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