Publication:
Competition and privatization

Thumbnail Image
Identifiers
URI: https://hdl.handle.net/10016/4941
Files
Competition-WPIVIE-1999-13-preprint.pdf (1.25 MB)
Publication date
1999
Defense date
Authors
Advisors
Tutors
Journal Title
Journal ISSN
Volume Title
Publisher
Impact
Google Scholar
Export
Research Projects
Organizational Units
Journal Issue
Abstract
In this paper we study the interaction between privatization and competition (liberalization)in the market. Privatization is understood as a change in the objetive of the owners of the firm. A public firm maximizes social welfare and a private firme maximizes profits. We find that this difference in objectives matters less the greater the level of competition because then the behavior of a wealfare maximizing firm converges to the behavior of a profit maximizing firm. This result implies that provatization work better the greater the competition. On the other hand, the revenue obtained from privatization are decreasing with the level of competition. This implies that privatization aimed to raise revenues impose a cost in terms of allocative efficiency.
Description
Keywords
Privatization, Liberalization
Bibliographic citation
Collections
DE - Otros documentos
Economists Online