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Regulation of a complementary imputed good in an competitive environment

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  • Sögner, Leopold

Abstract

This article investigates the problem of a regulated imputed good which is used in the production process of the final goods. The relationship between the firm producing the essential input factor and the regulating authority is described by a standard principal-agent setup. We show that ( by assuming a fixed functional relationship in the production process between the imputed good and the final market goods (there exists separation between regulation and competition on the final good market. Thus, the degree of competitiveness on the final good market has no effect on optimal contracts. Moreover, in our model vertical integration weakly dominates vertical disintegration in welfare for subadditive cost functions. (author's abstract)

Suggested Citation

  • Sögner, Leopold, 1998. "Regulation of a complementary imputed good in an competitive environment," Department of Economics Working Paper Series 56, WU Vienna University of Economics and Business.
    • Handle: RePEc:wiw:wus005:128
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    References listed on IDEAS

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    Cited by:

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    6. Theresa Grafeneder-Weissteiner & Klaus Prettner, 2009. "Agglomeration and population aging in a two region model of exogenous growth," Department of Economics Working Papers wuwp125, Vienna University of Economics and Business, Department of Economics.
    7. Engelbert Stockhammer & Paul Ramskogler, 2008. "Uncertainty and Exploitation in History," Journal of Economic Issues, Taylor & Francis Journals, vol. 42(1), pages 175-194, March.
    8. Pasquale Commendatore & Ingrid Kubin & Carmelo Petraglia, 2009. "Footloose Capital and Productive Public Services," Chapters, in: Neri Salvadori & Pasquale Commendatore & Massimo Tamberi (ed.), Geography, Structural Change and Economic Development, chapter 1, Edward Elgar Publishing.
    9. Özlem Onaran, 2007. "International financial markets and fragility in the Eastern Europe: "can it happen" here?," Department of Economics Working Papers wuwp108, Vienna University of Economics and Business, Department of Economics.

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