Presence of foreign investors in privatized firms and privatization policy

Ming Hsin Lin and Toshihiro Matsumura

Journal of Economics, 2012, vol. 107, issue 1, 80 pages

Abstract: This paper investigates how the presence of foreign investors in privatized firms affects privatization policy in a mixed oligopoly. We find that an increase in the stockholding ratio of foreign investors in a privatized firm increases the optimal degree of privatization, whereas an increase in the penetration of foreign firms in product markets reduces it. These results imply that the degree of openness of financial markets and that of product markets have contrasting implications for the optimal privatization policy. Copyright Springer-Verlag 2012

Keywords: Partial privatization; Foreign investment in privatized firms; Foreign private competitors; H42; F13; L13 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (89)

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Persistent link: https://EconPapers.repec.org/RePEc:kap:jeczfn:v:107:y:2012:i:1:p:71-80

DOI: 10.1007/s00712-011-0254-4

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