Mixed Duopoly, Degree of Privatization and Firm Behaviors

• Main Authors: CHEN,YEN-YU, 陳彥宇
• Other Authors: SHIEH,SHIOU
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/70590431514594845066

碩士 === 國立臺北大學 === 經濟學系 === 104 === In this thesis we consider a mixed duopoly market in which two firms produce differentiated products and the public firm is a partially privatized firm. We analyze how the degree of privatization of the public firm affects two firms’ strategic delegation and the mode of competition. Chapter 1 discusses the motivation of the study, provides a literature review, and describes the analytical framework as well as solution concept used in the thesis. In chapter 2, we investigate how the degree of privatization of public firm affects two firms’ strategic delegation under Cournot and Bertrand competition, respectively. We find that under Cournot competition, hiring manager is the private firm’s dominant strategy regardless of the degree of privatization, while the public firm hires manager only if the degree of privatization is high enough. Under Bertrand competition, hiring manager is still the private firm’s dominant strategy, while the public firm’s hiring decision depends on the degree of privatization and the degree of product differentiation. In chapter 3, we investigate the relation between the degree of privatization and the node of competition. We find that both firms choose price competition when the degree of privatization is high enough. By contrast, both firms choose quantity competition when the degree of privatization is low enough. When the degree of privatization is in the intermediate range, there are three sub-cases. First, the private firm chooses quantity competition and the public firm chooses price competition when the public firm cares relatively more about social welfare. Second, the private firm chooses price competition and the public firm chooses quantity competition when the public firm cares relatively more about its own profit. Finally, there exists a small parameter space in which there is no pure-strategy Nash equilibrium regarding the choice of competition mode when the public firm does not have a clear inclination toward social welfare or own profits. Chapter 4 concludes with some remarks.