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Time-Based Competition and the Privatization of Services

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  • Steinbacka, Rune
  • Tombak, Mihkel M

Abstract

The authors develop a vertical differentiation model which exhibits congestion externalities and in which firms choose service time. This model is formulated for a variety of industry and ownership structures. The authors find an ownership effect in which service speeds decrease when public services are privatized. This effect, however, could be offset and even reversed by increased efficiency of private services. The authors also investigate how prices and commitment ability with respect to service times will affect the service speeds in equilibrium. Copyright 1995 by Blackwell Publishing Ltd.

Suggested Citation

  • Steinbacka, Rune & Tombak, Mihkel M, 1995. "Time-Based Competition and the Privatization of Services," Journal of Industrial Economics, Wiley Blackwell, vol. 43(4), pages 435-454, December.
    • Handle: RePEc:bla:jindec:v:43:y:1995:i:4:p:435-54
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    Cited by:

    1. de Palma, Andre & Lindsey, Robin, 2002. "Private roads, competition, and incentives to adopt time-based congestion tolling," Journal of Urban Economics, Elsevier, vol. 52(2), pages 217-241, September.
    2. Judit OLÁH & József POPP & Gabriella ANTAL, 2018. "Time-Based Competition In The Supply-Chain: The Role Of The Logistics Service Providers," SEA - Practical Application of Science, Romanian Foundation for Business Intelligence, Editorial Department, issue 16, pages 37-46, May.
    3. Stenbacka Rune & Tombak Mihkel, 2018. "Optimal Reimbursement Policy in Health Care: Competition, Ownership Structure and Quality Provision," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 18(1), pages 1-19, January.

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