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Equilibrium State Aid in Integrating Markets

Author

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  • Martin Stephen

    (Purdue University)

  • Valbonesi Paola

    (University of Padova)

Abstract

We present a model of the impact of state aid on equilibrium market structure and on market performance in an integrating market when the process of integration is driven by consumer inertia. In a partial equilibrium model, it is an equilibrium for governments to grant state aid, even though this reduces common market welfare.

Suggested Citation

  • Martin Stephen & Valbonesi Paola, 2008. "Equilibrium State Aid in Integrating Markets," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 1-39, August.
    • Handle: RePEc:bpj:bejeap:v:8:y:2008:i:1:n:33
    DOI: 10.2202/1935-1682.1904
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    References listed on IDEAS

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    Cited by:

    1. Humphery-Jenner, M., 2011. "Diversification in Private Equity Funds : On Knowledge-sharing, Risk-aversion and Limited-attention," Other publications TiSEM 072b8035-9fb0-4f18-9c1b-f, Tilburg University, School of Economics and Management.
    2. Marcella Nicolini & Carlo Scarpa & Paola Valbonesi, 2013. "Aiding Car Producers in the EU: Money in Search of a Strategy," Journal of Industry, Competition and Trade, Springer, vol. 13(1), pages 67-87, March.
    3. Bertsch Christoph & Calcagno Claudio & Le Quement Mark, 2015. "Systematic Bailout Guarantees and Tacit Coordination," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(1), pages 1-36, January.
    4. Fatih Cemil ÖZBUĞDAY & Erik BROUWER, 2016. "Measuring the Extent of European State Aid Control: An Econometric Analysis of the European Commission Decisions," Sosyoekonomi Journal, Sosyoekonomi Society, issue 24(30).
    5. Christoph Bertsch & Claudio Calcagno & Mark Le Quement, 2009. "State aid and tacit collusion," Economics Working Papers ECO2009/36, European University Institute.

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