search query: @author Thisse, J-F. / total: 15
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| Author: | Anderson, S. P. Palma, A. de Thisse, J-F. |
| Title: | Privatization and efficiency in a differentiated industry |
| Journal: | European Economic Review
1997 : DEC, VOL. 41:9, p. 1635-1654 |
| Index terms: | PRIVATIZATION OLIGOPOLY PRODUCT DIFFERENTIATION |
| Language: | eng |
| Abstract: | In the paper, a market is considered in which a public firm competes against private ones. It is asked what happens when the public firm is privatized. In the short run, privatization is harmful because prices rise, that is, the disciplinary role of the public firm is lost. In the long run, privatization leads to further entry. A sufficient statistic for the social surplus to be higher in the long run is that the public firm makes a loss. This suggests that profitable firms should not necessarily be privatized. |
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