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Mixed duopoly, privatization, and subsidization with excess burden of taxation
Author(s) -
Matsumura Toshihiro,
Tomaru Yoshihiro
Publication year - 2013
Publication title -
canadian journal of economics/revue canadienne d'économique
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.773
H-Index - 69
eISSN - 1540-5982
pISSN - 0008-4085
DOI - 10.1111/caje.12022
Subject(s) - subsidy , stackelberg competition , cournot competition , economics , microeconomics , oligopoly , welfare , competition (biology) , neutrality , public economics , market economy , ecology , philosophy , epistemology , biology
Abstract We investigate optimal tax‐subsidy policies in mixed and private oligopolies with excess burden of taxation. We compare the optimal subsidies and the resulting welfare levels among four regimes: mixed and private Cournot duopolies and Stackelberg competition with public and private leaderships. We show that, in contrast to the existing works on the privatization neutrality theorem, privatization affects resulting welfare.