Abstract

http://ssrn.com/abstract=324640
 
 

Citations (7)



 
 

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Public Stackelberg Leadership in a Mixed Oligopoly with Foreign Firms


Kenneth Fjell


Norwegian School of Economics (NHH)

John S. Heywood


University of Wisconsin at Milwaukee; University of Birmingham - Department of Commerce


Australian Economin Papers, Vol. 41, pp. 267-281, 2002

Abstract:     
This is the first paper to consider a mixed oligopoly in which a public Stackelberg leader competes with both domestic and foreign private firms. The welfare maximising leader is shown to always produce less than under previous Cournot conjectures. Introducing leadership also alters previous public pricing rules resulting in prices that may be either greater than or less than marginal cost depending on the relative number of domestic firms. Furthermore, entry of a foreign firm will increase welfare only when the relative number of domestic firms is small, but that share is shown to be larger than has been indicated without leadership. Unlike previous models, the influence on public profit of a foreign acquisition is ambiguous and is related to the relative number of domestic firms. Finally, the consequences of privatisation are shown, for the first time, to depend on the relative number of domestic firms.

Number of Pages in PDF File: 15

Accepted Paper Series


Date posted: December 28, 2002  

Suggested Citation

Fjell, Kenneth and Heywood, John S., Public Stackelberg Leadership in a Mixed Oligopoly with Foreign Firms. Australian Economin Papers, Vol. 41, pp. 267-281, 2002. Available at SSRN: http://ssrn.com/abstract=324640

Contact Information

Kenneth Fjell (Contact Author)
Norwegian School of Economics (NHH) ( email )
Helleveien 30
N-5035 Bergen, 5045
Norway
John S. Heywood
University of Wisconsin at Milwaukee ( email )
210 N. Maryland Avenue
Milwaukee, WI 53211
United States
414-229-4437 (Phone)
414-229-3860 (Fax)
University of Birmingham - Department of Commerce
Edgbaston, Birmingham B15 2TT
United Kingdom
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