Optimal partial privatization in an endogenous timing game: a mixed oligopoly approach

Akio Kawasaki (), Takao Ohkawa and Makoto Okamura
Additional contact information
Akio Kawasaki: Oita University
Takao Ohkawa: Ritsumeikan University
Makoto Okamura: Hiroshima University

Journal of Economics, 2022, vol. 136, issue 3, No 2, 227-250

Abstract: Abstract This study examines endogenous determinations of both the degree of partial privatization and the timing of quantity competition under a homogeneous product duopoly with a public and either a domestic or a foreign private firm. We develop a three-stage game. In the first stage, a domestic government determines its partial privatization level. In the second stage, each firm decides the timing of its quantity setting. In the third stage, each firm sets its output level based on this timing. To select a single equilibrium for the timing game, we use the risk-dominance criterion. The main conclusion is as follows. When the private firm is domestic, partial privatization and private leadership emerge in equilibrium, whereas when the private firm is foreign, full nationalization and public leadership emerge in equilibrium.

Keywords: Mixed oligopoly; Endogenous timing game; Partial privatization; Risk-dominant equilibrium (search for similar items in EconPapers)
JEL-codes: L13 L32 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://link.springer.com/10.1007/s00712-022-00777-9 Abstract (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jeczfn:v:136:y:2022:i:3:d:10.1007_s00712-022-00777-9

DOI: 10.1007/s00712-022-00777-9

Access Statistics for this article

Journal of Economics is currently edited by Giacomo Corneo

More articles in Journal of Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().