IDEAS home Printed from https://ideas.repec.org/a/bla/jecrev/v65y2014i4p521-542.html
   My bibliography  Save this article

Organizational Structure and the Choice of Price versus Quantity in a Mixed Duopoly

Author

Listed:
  • Alessandra Chirco
  • Caterina Colombo
  • Marcella Scrimitore

Abstract

type="main"> We consider the choice of price/quantity of a public and a private firm in a mixed differentiated duopoly. First, we study the way in which the strategic choice of the market variable is affected by different given organizational structures (managerial or entrepreneurial) of the public and the private firm. Second, we investigate how the price/quantity choice interacts with the endogenous choice of the organizational structure, thus determining a subgame perfect equilibrium at which firms choose to behave as price-setters and to adopt a managerial structure.

Suggested Citation

  • Alessandra Chirco & Caterina Colombo & Marcella Scrimitore, 2014. "Organizational Structure and the Choice of Price versus Quantity in a Mixed Duopoly," The Japanese Economic Review, Japanese Economic Association, vol. 65(4), pages 521-542, December.
    • Handle: RePEc:bla:jecrev:v:65:y:2014:i:4:p:521-542
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/jere.12046
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yoshihiro Tomaru & Yasuhiko Nakamura & Masayuki Saito, 2011. "Strategic Managerial Delegation In A Mixed Duopoly With Capacity Choice: Partial Delegation Or Full Delegation," Manchester School, University of Manchester, vol. 79(4), pages 811-838, July.
    2. Michael Kopel & Clemens Löffler, 2012. "Organizational Governance, Leadership, and the Influence of Competition," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 168(3), pages 362-392, September.
    3. Fershtman, Chaim & Judd, Kenneth L, 1987. "Equilibrium Incentives in Oligopoly," American Economic Review, American Economic Association, vol. 77(5), pages 927-940, December.
    4. White, Mark D., 2001. "Managerial incentives and the decision to hire managers in markets with public and private firms," European Journal of Political Economy, Elsevier, vol. 17(4), pages 877-896, November.
    5. Barcena-Ruiz, Juan Carlos & Casado-Izaga, F. Javier, 2005. "Should shareholders delegate location decisions?," Research in Economics, Elsevier, vol. 59(3), pages 209-222, September.
    6. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-325, June.
    7. Kenji Fujiwara, 2007. "Partial Privatization in a Differentiated Mixed Oligopoly," Journal of Economics, Springer, vol. 92(1), pages 51-65, September.
    8. White, Mark D., 2002. "Political manipulation of a public firm's objective function," Journal of Economic Behavior & Organization, Elsevier, vol. 49(4), pages 487-499, December.
    9. Basu, Kaushik, 1995. "Stackelberg equilibrium in oligopoly: An explanation based on managerial incentives," Economics Letters, Elsevier, vol. 49(4), pages 459-464, October.
    10. Evangelos Mitrokostas & Emmanuel Petrakis, 2014. "Organizational structure, strategic delegation and innovation in oligopolistic industries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 23(1), pages 1-24, January.
    11. Luca Lambertini, 2000. "Strategic Delegation and the Shape of Market Competition," Scottish Journal of Political Economy, Scottish Economic Society, vol. 47(5), pages 550-570, November.
    12. Paul Klemperer & Margaret Meyer, 1986. "Price Competition vs. Quantity Competition: The Role of Uncertainty," RAND Journal of Economics, The RAND Corporation, vol. 17(4), pages 618-638, Winter.
    13. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
    14. Barros, Fatima, 1995. "Incentive schemes as strategic variables: An application to a mixed duopoly," International Journal of Industrial Organization, Elsevier, vol. 13(3), pages 373-386, September.
    15. Juan Carlos Bárcena‐Ruiz, 2009. "The Decision To Hire Managers In Mixed Markets Under Bertrand Competition," The Japanese Economic Review, Japanese Economic Association, vol. 60(3), pages 376-388, September.
    16. Matsumura, Toshihiro & Ogawa, Akira, 2012. "Price versus quantity in a mixed duopoly," Economics Letters, Elsevier, vol. 116(2), pages 174-177.
    17. Patrick Bolton, 1995. "Privatization and the separation of ownership and control: lessons from Chinese enterprise reform," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 3(1), pages 1-11, March.
    18. Vickers, John, 1985. "Delegation and the Theory of the Firm," Economic Journal, Royal Economic Society, vol. 95(380a), pages 138-147, Supplemen.
    19. Yasuhiko Nakamura & Tomohiro Inoue, 2009. "Endogenous timing in a mixed duopoly: price competition with managerial delegation," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 30(5), pages 325-333.
    20. Lambertini, Luca & Schultz, Christian, 2003. "Price or quantity in tacit collusion?," Economics Letters, Elsevier, vol. 78(1), pages 131-137, January.
    21. repec:bla:scotjp:v:47:y:2000:i:5:p:550-70 is not listed on IDEAS
    22. Markus Reisinger & Ludwig Ressner, 2009. "The Choice of Prices versus Quantities under Uncertainty," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(4), pages 1155-1177, December.
    23. Nolan Miller & Amit Pazgal, 2002. "Relative performance as a strategic commitment mechanism," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 23(2), pages 51-68.
    24. Kangsik Choi, 2012. "Price And Quantity Competition In A Unionised Mixed Duopoly: The Cases Of Substitutes And Complements," Australian Economic Papers, Wiley Blackwell, vol. 51(1), pages 1-22, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chang Ray-Yun & Hu Jin-Li & Lin Yan-Shu, 2018. "The Choice of Prices versus Quantities under Outsourcing," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 18(2), pages 1-20, July.
    2. Yasuhiko Nakamura, 2019. "Combining the Endogenous Choice of the Timing of Setting the Levels of Strategic Contracts and Their Contents in a Managerial Mixed Duopoly," Journal of Industry, Competition and Trade, Springer, vol. 19(2), pages 235-261, June.
    3. Toshihiro Matsumura & Akira Ogawa, 2016. "Corporate social responsibility and endogenous competition structure," Economics Bulletin, AccessEcon, vol. 36(4), pages 2117-2127.
    4. Kangsik Choi, 2023. "Endogenous organizational form in a multiproduct mixed duopoly," The Japanese Economic Review, Springer, vol. 74(2), pages 279-299, April.
    5. Nakamura, Yasuhiko, 2015. "Endogenous choice of strategic incentives in a mixed duopoly with a new managerial delegation contract for the public firm," International Review of Economics & Finance, Elsevier, vol. 35(C), pages 262-277.
    6. Yasuhiko Nakamura, 2020. "Endogenously choosing the timing of setting strategic contracts’ levels and content in a managerial mixed duopoly with welfare-based and sales delegation contracts," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(3), pages 363-402, September.
    7. Fanti, Luciano & Buccella, Domenico, 2018. "Corporate social responsibility and the choice of price versus quantities," Japan and the World Economy, Elsevier, vol. 48(C), pages 71-78.
    8. Yasuhiko Nakamura, 2017. "Endogenous market structures in a mixed oligopoly with a public firm whose managerial contract is based on welfare and bargaining over the managerial contract of a private firm," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 34(2), pages 189-209, August.
    9. Amarjyoti Mahanta, 2019. "Endogenous strategic variable in a mixed duopoly," Journal of Economics, Springer, vol. 128(1), pages 47-65, September.
    10. Yasuhiko Nakamura, 2017. "Price Versus Quantity in a Duopoly with a Unilateral Effect and with Bargaining over Managerial Contracts," Journal of Industry, Competition and Trade, Springer, vol. 17(1), pages 83-119, March.
    11. Kangsik Choi, 2019. "Price And Quantity Competition With Asymmetric Costs In A Mixed Duopoly: A Technical Note," Bulletin of Economic Research, Wiley Blackwell, vol. 71(1), pages 33-46, January.
    12. Kosuke Hirose & Toshihiro Matsumura, 2019. "Comparing welfare and profit in quantity and price competition within Stackelberg mixed duopolies," Journal of Economics, Springer, vol. 126(1), pages 75-93, January.
    13. Yasuhiko Nakamura, 2017. "Choosing Price or Quantity? The Role of Delegation and Network Externalities in a Mixed Duopoly," Australian Economic Papers, Wiley Blackwell, vol. 56(2), pages 174-200, June.
    14. Yasuhiko Nakamura, 2019. "Endogenous Choice of the Timing of Setting Incentive Parameters and the Strategic Contracts in a Managerial Mixed Duopoly with a Welfare-Based Delegation Contract and a Sales Delegation Contract," Journal of Industry, Competition and Trade, Springer, vol. 19(4), pages 679-737, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Alessandra Chirco & Caterina Colombo & Marcella Scrimitore, 2013. "Organizational Structure and the Choice of Price vs. Quantity in a Mixed Duopoly," Working Paper series 27_13, Rimini Centre for Economic Analysis.
    2. Nakamura, Yasuhiko, 2019. "Combining the endogenous choice of the timing of setting incentive parameters and the contents of strategic contracts in a managerial mixed duopoly," International Review of Economics & Finance, Elsevier, vol. 59(C), pages 207-233.
    3. Yasuhiko Nakamura, 2019. "Combining the Endogenous Choice of the Timing of Setting the Levels of Strategic Contracts and Their Contents in a Managerial Mixed Duopoly," Journal of Industry, Competition and Trade, Springer, vol. 19(2), pages 235-261, June.
    4. Yasuhiko Nakamura, 2015. "Endogenous Choice of Strategic Variables in an Asymmetric Duopoly with Respect to the Demand Functions that Firms Face," Manchester School, University of Manchester, vol. 83(5), pages 546-567, September.
    5. Nakamura, Yasuhiko, 2015. "Endogenous choice of strategic incentives in a mixed duopoly with a new managerial delegation contract for the public firm," International Review of Economics & Finance, Elsevier, vol. 35(C), pages 262-277.
    6. Corrado Benassi & Alessandra Chirco & Caterina Colombo, 2021. "Efficiency of bilateral delegation in a mixed Cournot duopoly," Metroeconomica, Wiley Blackwell, vol. 72(3), pages 493-508, July.
    7. John S. Heywood & Zerong Wang & Guangliang Ye, 2022. "Strategic delegation in an international mixed oligopoly," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(6), pages 1888-1898, September.
    8. Michael Kopel & Marco Marini, 2014. "Strategic delegation in consumer cooperatives under mixed oligopoly," Journal of Economics, Springer, vol. 113(3), pages 275-296, November.
    9. Yasuhiko Nakamura, 2017. "Choosing Price or Quantity? The Role of Delegation and Network Externalities in a Mixed Duopoly," Australian Economic Papers, Wiley Blackwell, vol. 56(2), pages 174-200, June.
    10. Bian, Junsong & Li, Kevin W. & Guo, Xiaolei, 2016. "A strategic analysis of incorporating CSR into managerial incentive design," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 86(C), pages 83-93.
    11. Yasuhiko Nakamura, 2015. "Endogenous Choice of Strategic Contracts in a Mixed Duopoly with Bargaining Over Managerial Delegation Contracts," Australian Economic Papers, Wiley Blackwell, vol. 54(2), pages 121-134, June.
    12. Yasuhiko Nakamura, 2019. "Endogenous Choice of the Timing of Setting Incentive Parameters and the Strategic Contracts in a Managerial Mixed Duopoly with a Welfare-Based Delegation Contract and a Sales Delegation Contract," Journal of Industry, Competition and Trade, Springer, vol. 19(4), pages 679-737, December.
    13. Corrado Benassi & Alessandra Chirco & Marcella Scrimitore, 2014. "Optimal manipulation rules in a mixed oligopoly," Journal of Economics, Springer, vol. 112(1), pages 61-84, May.
    14. Ya‐chin Wang & Leonard F.s. Wang, 2009. "Equivalence Of Competition Mode In A Vertically Differentiated Duopoly With Delegation," South African Journal of Economics, Economic Society of South Africa, vol. 77(4), pages 577-590, December.
    15. Yoshihiro Tomaru & Yasuhiko Nakamura & Masayuki Saito, 2009. "Capacity Choice in a Mixed Duopoly with Managerial Delegation," Economics Bulletin, AccessEcon, vol. 29(3), pages 1904-1924.
    16. Evangelos Mitrokostas & Emmanuel Petrakis, 2014. "Organizational structure, strategic delegation and innovation in oligopolistic industries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 23(1), pages 1-24, January.
    17. Scrimitore, Marcella, 2013. "Price or quantity? The strategic choice of subsidized firms in a mixed duopoly," Economics Letters, Elsevier, vol. 118(2), pages 337-341.
    18. Juan Carlos Barcena-Ruiz, 2010. "Strategic Delegation and Semipublic Firms," Economics Bulletin, AccessEcon, vol. 30(1), pages 744-750.
    19. Yasuhiko Nakamura, 2020. "Endogenously choosing the timing of setting strategic contracts’ levels and content in a managerial mixed duopoly with welfare-based and sales delegation contracts," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(3), pages 363-402, September.
    20. Xing, Mingqing & Lee, Sang-Ho, 2024. "Cross-ownership and green managerial delegation contracts in a mixed oligopoly," Journal of Environmental Economics and Management, Elsevier, vol. 126(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jecrev:v:65:y:2014:i:4:p:521-542. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/jeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.