Privatization In Closed And Open Mixed Oligopolies

Communications of the IBIMA

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Najiba Benabess 

Norwich University, Vermont, USA

Volume 2009 (2009), Article ID 960795, Communications of the IBIMA, 11 pages, DOI:

Received date : 18 July 2009; Accepted date : 13 October 2009; Published date : 13 December 2009

Abstract

This paper is the first to collect and organize the many past theoretical results on the predicted welfare effects of privatization in mixed oligopolies. Our review of past models demonstrates that the most critical elements in predicting the influence of privatization in mixed oligopoly are the timing of the game, and whether or not the market is open to foreign competition. In organizing these results it becomes apparent that several cases remain missing in the resulting matrix.  I develop these cases and conclude that a public Stackelberg leader should never privatize while a public Cournot firm should be privatized when a domestic market is more competitive. 

Keywords: Privatization, Mixed Oligopoly, Cournot model, Stackelberg model.