Privatization in a mixed oligopoly: Productivity, market concentration, and the optimal degree of privatization

Shinjiro Miyazawa ()
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Shinjiro Miyazawa: Graduate School of Economics, Kobe University

No 1220, Discussion Papers from Graduate School of Economics, Kobe University

Abstract: This paper investigates the optimal degree of privatization for a public firm in a homogeneous mixed oligopoly. I show that full privatization is optimal when a public firm has a severe productivity disadvantage or competes with many private firms. The optimal degree of partial privatization is increasing in the degree of productivity disadvantage and the number of private firms. I further show that partial privatization can be optimal for a public firm even when full privatization would completely remove any productivity disadvantages.

Keywords: quantity-setting competition; partial privatization; mixed oligopoly (search for similar items in EconPapers)
JEL-codes: L13 L32 L33 (search for similar items in EconPapers)
Pages: 12pages
Date: 2012-10
New Economics Papers: this item is included in nep-com and nep-ind
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