A Mixed Oligopoly in the Presence of Foreign Private Firms

Abstract

In this paper, a mixed oligopoly model is considered in which a state-owned public firm competes with both domestic and foreign private firms. Previous articles on mixed oligopoly did not include foreign private firms. The effect on the equilibrium involves a lower price and a different allocation of production (relative to the case when all private firms are domestically owned). In addition, issues such as the effects of an open door policy allowing foreign firms to enter and the effects of foreign acquisition of domestic firms are discussed.

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