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Public-Private Monopoly

Marian Moszoro

MPRA Paper from University Library of Munich, Germany

Abstract: This paper presents comparative statics of organizational modes of natural monopoly in public utilities with a focus on co-ownership and co-governance. Private monopoly lowers output and increases the price to maximize profit; public monopoly incurs higher costs due to the lack of know-how; and a regulated monopoly results in regulation costs to overcome informational asymmetries. A public-private partnership arises as an efficient organization mode when it enables the internalization of private know-how and saves regulation costs due to correspondingly sufficient private and public residual control rights. Public-private partnerships support higher prices than marginal costs due to rent sharing, with its upper price frontier decreasing in private residual control rights.

Keywords: Natural Monopolies; Operating Efficiency; Public-Private Partnerships; Organization Structure; Regulation (search for similar items in EconPapers)
JEL-codes: L22 L32 L43 L51 (search for similar items in EconPapers)
Date: 2018-04
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Citations: View citations in EconPapers (2)

Published in The B.E. Journal of Economic Analysis & Policy 2.18(2018): pp. 1-13

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Journal Article: Public–Private Monopoly (2018) Downloads
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