Profit‐enhancing entries in mixed oligopolies.
Mixed oligopolies are characterized by private and public enterprises. Previously, entry into these markets was restrictive. It has since been relaxed by deregulations, and as a result, private firms have entered mixed oligopolies. An increase in the number of private firms increases competition amo...
| Publicado en: | Southern Economic Journal Vol. 88; no. 1; pp. 33 - 56 |
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| Autores principales: | , |
| Formato: | Artículo |
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Wiley-Blackwell
Jul2021
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| Materias: | |
| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=151330651&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 151330651 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00384038 SEJ jtl: Southern Economic Journal issn: 00384038 maglogo: N pubinfo: dt: Jul2021 vid: 88 iid: 1 pid: 480 pub: Wiley-Blackwell artinfo: ui: 151330651 10.1002/soej.12506 ppf: 33 ppct: 23 formats: fmt: – @attributes: type: T – @attributes: type: C – @attributes: type: P size: 2.3MB tig: atl: Profit‐enhancing entries in mixed oligopolies. aug: au: Haraguchi, Junichi Matsumura, Toshihiro affil: Faculty of Economics, Kanagawa University, Yokohama Kanagawa,, Japan Institute of Social Science, The University of Tokyo, Tokyo, Japan su: Oligopolies Government business enterprises Free enterprise Cost functions Industrial costs sug: subj: Oligopolies Government business enterprises Free enterprise Cost functions Industrial costs keyword: multiple long‐run stable equilibria optimal degree of privatization profit‐enhancing entry multiple long‐run stable equilibria optimal degree of privatization profit‐enhancing entry ab: Mixed oligopolies are characterized by private and public enterprises. Previously, entry into these markets was restrictive. It has since been relaxed by deregulations, and as a result, private firms have entered mixed oligopolies. An increase in the number of private firms increases competition among them and reduces the profit of incumbent private firms, given the privatization policy remains unchanged. However, an increase in the number of private firms may affect privatization policy, and thus, indirectly affect private firms' profits. Therefore, the overall effect on private firms' profit is ambiguous. In this study, we investigate how the number of private firms affects the profit of each private firm in mixed oligopolies. We use a linear‐quadratic production cost function, which covers two popular model formulations in the mixed oligopoly literature. We show that if the degree of privatization is exogenous, the profit of each private firm decreases with the number of private firms. However, if the degree of privatization is endogenous, the relationship between the number of private firms and profit takes an inverted‐U shape under a plausible range of cost parameters. Our results imply that there can exist multiple equilibria in free‐entry markets with different degrees of privatization. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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