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Privatization and government preference in a Bertrand model
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Orientador(es)
Resumo(s)
We will consider a mixed Bertrand duopoly model (that means, two firms decide simultaneously their prices for a substitutable good) to study the relationship between the privatization of a state-owned public firm and government preferences for tax revenue. In the model, we assume that the government imposes a specific tax rate on the quantity produced by each firm. Furthermore, the public firm aims to maximize social welfare, whereas the government's objective function is a weighted sum between social welfare and tax revenue. Of course, the private firm aims to maximize its own profit. We also present comparative static results.
Descrição
Palavras-chave
Modeling Optimization Industrial organization Game theory
Contexto Educativo
Citação
Editora
INPE - National Institute for Space Research