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Multiple Long-Run Equilibria in a Free-Entry Mixed Oligopoly

Author

Listed:
  • Haraguchi, Junichi
  • Matsumura, Toshihiro

Abstract

We investigate a free-entry mixed oligopoly with constant marginal costs. A privatization policy is implemented after private firms enter the market. We find that both full privatization and full nationalization are equilibrium policies, and the former is the worst privatization policy for welfare.

Suggested Citation

  • Haraguchi, Junichi & Matsumura, Toshihiro, 2018. "Multiple Long-Run Equilibria in a Free-Entry Mixed Oligopoly," MPRA Paper 86704, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:86704
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    File URL: https://mpra.ub.uni-muenchen.de/86704/2/MPRA_paper_86704.pdf
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    References listed on IDEAS

    as
    1. repec:kap:jeczfn:v:123:y:2018:i:1:d:10.1007_s00712-017-0559-z is not listed on IDEAS
    2. Juan Carlos Bárcena-Ruiz & María Begoña Garzón, 2005. "International Trade and Strategic Privatization," Review of Development Economics, Wiley Blackwell, vol. 9(4), pages 502-513, November.
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    4. Susumu Cato & Toshihiro Matsumura, 2012. "Long-Run Effects of Foreign Penetration on Privatization Policies," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 168(3), pages 444-454, September.
    5. Stefano Colombo, 2016. "Mixed oligopolies and collusion," Journal of Economics, Springer, vol. 118(2), pages 167-184, June.
    6. Ishida, Junichiro & Matsushima, Noriaki, 2009. "Should civil servants be restricted in wage bargaining? A mixed-duopoly approach," Journal of Public Economics, Elsevier, vol. 93(3-4), pages 634-646, April.
    7. Przemyslaw Kowalski & Max Büge & Monika Sztajerowska & Matias Egeland, 2013. "State-Owned Enterprises: Trade Effects and Policy Implications," OECD Trade Policy Papers 147, OECD Publishing.
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    10. repec:kap:jeczfn:v:120:y:2017:i:3:d:10.1007_s00712-016-0502-8 is not listed on IDEAS
    11. Susumu Cato & Toshihiro Matsumura, 2013. "Long-Run Effects of Tax Policies in a Mixed Market," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 69(2), pages 215-240, June.
    12. Susumu Cato & Toshihiro Matsumura, 2015. "Optimal Privatisation and Trade Policies with Endogenous Market Structure," The Economic Record, The Economic Society of Australia, vol. 91(294), pages 309-323, September.
    13. Sato, Susumu & Matsumura, Toshihiro, 2017. "Dynamic privatization policy," MPRA Paper 79849, University Library of Munich, Germany.
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    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    entry-then-privatization; constant marginal costs; profit-enhancing entry; two polar equilibrium privatization policies;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • H44 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Goods: Mixed Markets
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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