Endogenous Cost Differentials between Public and Private Enterprises
A Mixed Duopoly Approach
Bibliographic Data
| ID | 9721024 |
|---|---|
| Authors | Toshihiro Matsumura (0000-0003-0572-6516, Ōtani University), Noriaki Matsushima (0000-0002-7865-3875, Shinshu University) |
| Year | 2004 |
| Volume | 71 |
| Issue | 284 |
| Pages | 671-688 |
| Publication date | 2004-11-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Economica (JOURNAL) |
| Journal identifiers | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/j.0013-0427.2004.00394.x |
| OpenAlex | W2165253791 |
| Language | EN |
| Citations received | 8 |
| References cited | 35 |
We investigate a mixed duopoly, where a state‐owned welfare‐maximizing public firm competes against a profit‐maximizing private firm. We use a Hotelling‐type spatial model which represents product differentiation. We endogenize production costs by introducing cost‐reducing activities. We show that the private firm's cost becomes lower than the public firm's because the private firm engages in excessive strategic cost‐reducing activities. Even though each firm's cost is heterogeneous, the locations of the firms are socially efficient, given the cost differentials. Privatization of the public firm would improve welfare because it would mitigate the loss arising from excessive cost‐reducing investments
Business · Cournot competition · Duopoly · Economics · Fixed cost · Industrial organization · Market economy · Microeconomics · Product differentiation · Production (economics) · Production cost · Profit (economics) · Strategic complements · Welfare · Consumer Market Behavior and Pricing · Digital Platforms and Economics · Merger and Competition Analysis
Spatial price discrimination in a mixed duopoly input market
R&D investments with spillovers and endogenous horizontal differentiation
Upstream SOEs in the mixed-ownership reform
R&D competition in a spatial model with technical risk
Disclosure Policy in a Mixed Market
Strategic R&D risk choices of public and private firms
Models of spatial competition
Public–Private Mixed Delivery and Information Effects
| Unique citing works | 8 |
|---|---|
| Citations per year | 0,57 |
| Citation span | 2012 - 2023 (12) |
| Citation velocity | historical |
| Highly cited | No |
| Citation types | Neutral: 8 |