scholarly journals Welfare Comparison of Leader-Follower Models in a Mixed Duopoly

2013 ◽  
Vol 2013 ◽  
pp. 1-7 ◽  
Author(s):  
Aiyuan Tao ◽  
Yingjun Zhu ◽  
Xiangqing Zou
Keyword(s):  
Optimal Choice ◽  
Private Firm ◽  
Mixed Duopoly ◽  
The Public ◽  
Public Firm ◽  
Market Leader ◽  
Welfare Comparison ◽  
Total Welfare

In the standard leader-follower duopoly models with otherwise symmetric firms, the market outcome and total welfare are the same whichever firm is the leader. This paper studies and compares total welfare in a sequential-move mixed duopoly when either the public firm or the private firm acts as the leader. It is found that the fact that which firm is the leader affects total welfare and that whether firms compete in quantity or price also affects the optimal choice of market leader.

Mixed Duopoly Stochastic Sales Model with Advertising and Experience Gains for the Public and Foreign Competitors

2020 ◽  
Vol 24 (5) ◽  
pp. 662-667
Author(s):  
Vitaliy Kalashnikov ◽  
Natalyia Kalashnykova ◽  
Petr Kuzmin ◽  
◽  
◽  
...  
Keyword(s):  
Control Variable ◽  
Private Firm ◽  
The State ◽  
Mixed Oligopoly ◽  
Mixed Duopoly ◽  
The Public ◽  
The Social ◽  
Public Firm ◽  
Owned Company ◽  
Foreign Competitors

In this research, we propose a stochastic model with the finite horizon of time for sales competition between the state-owned company and private (foreign) competitor. We assume that the foreign company objective function is to maximize revenues and the state-owned agent is concerned about welfare maximization. There are many stochastic models for sales, but what is new in our case is that we assume mixed oligopoly and have different types of firms: private and state owned. They have somewhat different objective functions. As a control variable, we take the advertisement expenses of the private firm. Sale bursts rate depends and the advertisement expenditure and experience stock gained. For the public firm, we assume that advertising efforts are fixed. It means that the optimal control is to maximize private firm revenues taking into account possible uncertainties of stochastic profit flow using Bellman’s optimality condition. We can find out that the Advertisement-Experience (AE) efforts of the private firm are increasing if sales are increasing. Next, the AE might decrease if the experience level of the private firm increases and we have a sales burst. To optimize the governmental policies, we check for optimal AE effort of the public firm so the social welfare achieves the maximum value.

Privatization, Unemployment, and Welfare in the Harris-Todaro Model with a Mixed Duopoly

2016 ◽  
Vol 16 (4) ◽  
Author(s):  
Jiancai Pi ◽  
Jun Yin
Keyword(s):  
Social Welfare ◽  
Market Share ◽  
Unemployment Rate ◽  
Relative Degree ◽  
Mixed Duopoly ◽  
Partial Privatization ◽  
The Public ◽  
Long Run ◽  
Public Firm ◽  
Short Run

Abstract This paper explores the unemployment and welfare effects of privatization through the Harris-Todaro model with a mixed duopoly. Our approach is more generalized than the existing literature. When capital is sector-specific (i. e., it is in the short run), an increase in the degree of partial privatization will raise the unemployment rate, but the change of social welfare is conditional on the market share of the public firm and the relative degree of partial privatization. When capital is sector-mobile (i. e., it is in the long run), an increase in the degree of partial privatization will reduce the unemployment rate, but the change of social welfare is also dependent on the market share of the public firm and the relative degree of partial privatization. Our results capture the fact that the public firm and the private firm usually coexist in a competitive environment in the real world.

scholarly journals Endogenous timing in a vertically differentiated mixed duopoly with Cournot competition

2016 ◽  
Vol 26 (2) ◽  
pp. 161-175
Author(s):  
Leidong Feng ◽  
Mengdi Gu
Keyword(s):  
Nash Equilibrium ◽  
Cournot Competition ◽  
Mixed Duopoly ◽  
Endogenous Timing ◽  
Output Stage ◽  
High Quality ◽  
The Public ◽  
Subgame Perfect Nash Equilibrium ◽  
Public Firm ◽  
Second Period

Abstract This paper compares the equilibrium outcomes under simultaneous and sequential output setting in a mixed duopoly in a vertically differentiated market. When the timing of the output game is determined endogenously, it is shown that simultaneous play in the quality stage with the public firm acting as the high-quality producer and simultaneous play in the second period in the output stage turn out to be the unique subgame perfect Nash equilibrium, which contrasts with the endogenous timing in a purely private duopoly.

scholarly journals Privatization, pollution, and welfare in a mixed differentiated duopoly

2018 ◽  
Vol 65 (4) ◽  
pp. 395-410 ◽  
Author(s):  
Jiancai Pi ◽  
Yiwen Guan
Keyword(s):  
Social Welfare ◽  
Environmental Pollution ◽  
Private Firm ◽  
Degree Of Substitution ◽  
Extra Cost ◽  
The Public ◽  
Environmental Preference ◽  
Public Firm ◽  
The Government

This paper investigates the impacts exerted by the residents? environmental preference on privatization in a mixed differentiated duopoly. We assume that the production will generate environmental pollution, which causes an extra cost that the private firm does not bear but residents with the environmental preference have to tolerate. The government pursues to maximize social welfare. We find that the residents? environmental preference has significant impacts on privatization. When residents pay more attention to environmental pollution, privatization cannot induce more social welfare, and thus the government will choose not to privatize the public firm. The degree of substitution of products will affect the results when the value of the residents? environmental preference is given, but the order of the firms? moves will not change the results.

Privatizing Multi-subsidiary Public Firm in Location Model

2017 ◽  
Vol 19 (1) ◽  
Author(s):  
Jingliang Chen ◽  
Jie Shuai
Keyword(s):  
Social Welfare ◽  
Consumer Welfare ◽  
Location Model ◽  
Transport Cost ◽  
Mixed Duopoly ◽  
Type Model ◽  
The Public ◽  
Public Firm ◽  
The Government

AbstractThis paper examines a different way of privatization from existing literature. In a mixed duopoly Hotelling type model in which the public firm consists of multiple subsidiaries, instead of privatizing the public firm as its entirety, the government may privatize only one of the subsidiaries (for example the manufacturing subsidiary). We find that this kind of privatization always improves social welfare comparing to no privatization at all. And comparing to privatizing the public firm in its entirety, privatizing only the manufacturing subsidiary always results in larger consumer welfare and results in larger social welfare when transport cost or R&D cost is sufficiently large.

scholarly journals THE IMPACT OF NEW CAR MARKET ON THE DKI JAKARTA POLICY TO LIMIT THE NUMBER OF VEHICLES

2019 ◽  
Vol 3 (02) ◽  
Author(s):  
Mego Widi Hakoso
Keyword(s):  
Qualitative Method ◽  
Complex Problem ◽  
New Order ◽  
Traffic Jam ◽  
The Public ◽  
Car Market ◽  
High Consumption ◽  
Market Leader ◽  
Holding Back ◽  
The Impact

A considerably high consumption of cars has led Jakarta to such a messy traffic that prompted the need for the DKI Jakarta Government to issue policies to fetter the public’s purchase power for new cars. Despite this, the public continues to buy new cars. This research was conducted using qualitative method, and also post-positivism paradigm as a viewpoint from which the field arena is observed. Data collection was done by conducting a review on documents, printed – online media news and interviews from various sources. Honda Brand, which is notably the market leader in Jakarta, is to be a representative of how business players address the DKI Jakarta Government’s policy which intends to reduce the purchase power. The result of this research shows that traffic jam in Jakarta has been a complex problem politically since the New Order, because automotive business players, as a capital, have become part of Indonesia’s political power and the performance of Honda Mobil sales has not been affected by the DKI Jakarta Government’s policy in holding back the public’s purchase power for new cars. Key Words: Automotive, Policy, Jakarta, Market, Honda

scholarly journals REVISITING THE OPTIMAL STATIONARY PUBLIC INVESTMENT POLICY IN ENDOGENOUS GROWTH ECONOMIES

2008 ◽  
Vol 12 (2) ◽  
pp. 172-194 ◽  
Author(s):  
GUSTAVO A. MARRERO
Keyword(s):  
Endogenous Growth ◽  
Public Investment ◽  
Public Capital ◽  
Optimal Choice ◽  
Public Infrastructure ◽  
The Public ◽  
Developed Economies ◽  
Elasticity Of Intertemporal Substitution ◽  
Output Ratio ◽  
Public Investment Policy

One part of the literature on endogenous growth concerns models where public infrastructure affects the private production process. An unsolved puzzle in this literature concerns observed public investment-to-output ratios for developed economies, which tend to fall short of theoretical model-based optimal ratios. We reexamine the optimal choice of public investment in a more general framework. This setting allows for long-lasting capital stocks, a lower depreciation rate for public capital than for private capital, an elasticity of intertemporal substitution that differs from unity, and the need to finance a nontrivial share of public services in output. Given other fundamentals in the economy, we show that the optimal public investment-to-output ratio is smaller for low-growth economies, for economies populated by consumers with low preferences for substituting consumption intertemporally, and when public capital is durable. For a calibrated economy, we show that a combination of these factors solves the public investment puzzle.

Privatization when the public firm is as efficient as private firms

2012 ◽  
Vol 29 (4) ◽  
pp. 1019-1023 ◽  
Author(s):  
Juan Carlos Bárcena-Ruiz
Keyword(s):  
Private Firms ◽  
The Public ◽  
Public Firm
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