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A Mixed Duopoly with a Lifetime Employment Contract as a Strategic Commitment

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  • Kazuhiro Ohnishi

Abstract

This paper examines the behaviors of a profit-maximizing private firm and a socialwelfare- maximizing public firm in a mixed market model with a lifetime employment contract as a strategic commitment. The paper then shows that there exists an equilibrium in which the private firm enters into a lifetime employment contract with its employees while the public firm does not.

Suggested Citation

  • Kazuhiro Ohnishi, 2006. "A Mixed Duopoly with a Lifetime Employment Contract as a Strategic Commitment," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 62(1), pages 108-123, March.
    • Handle: RePEc:mhr:finarc:urn:sici:0015-2218(200603)62:1_108:amdwal_2.0.tx_2-o
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    References listed on IDEAS

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    1. Cremer, Helmuth & Marchand, Maurice & Thisse, Jacques-Francois, 1989. "The Public Firm as an Instrument for Regulating an Oligopolistic Market," Oxford Economic Papers, Oxford University Press, vol. 41(2), pages 283-301, April.
    2. Askildsen, Jan Erik & Ireland, Norman J, 1993. "Human Capital, Property Rights, and Labour Managed Firms," Oxford Economic Papers, Oxford University Press, vol. 45(2), pages 229-242, April.
    3. Brander, James A. & Spencer, Barbara J., 1988. "Unionized oligopoly and international trade policy," Journal of International Economics, Elsevier, vol. 24(3-4), pages 217-234, May.
    4. Bughin, Jacques & Vannini, Stefano, 1995. "Strategic direct investment under unionized oligopoly," International Journal of Industrial Organization, Elsevier, vol. 13(1), pages 127-145, March.
    5. Leonard Cheng, 1985. "Comparing Bertrand and Cournot Equilibria: A Geometric Approach," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 146-152, Spring.
    6. Subhayu Bandyopadhyay & Sudeshna Bandyopadhyay, 2001. "Efficient bargaining, welfare and strategic export policy," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 10(2), pages 133-149.
    7. Hashimoto, Masanori & Raisian, John, 1985. "Employment Tenure and Earnings Profiles in Japan and the United States," American Economic Review, American Economic Association, vol. 75(4), pages 721-735, September.
    8. repec:bla:econom:v:57:y:1990:i:227:p:319-28 is not listed on IDEAS
    9. Futagami, Koichi & Okamura, Makoto, 1996. "Strategic Investment: The Labor-Managed Firm and the Profit-Maximizing Firm," Journal of Comparative Economics, Elsevier, vol. 23(1), pages 73-91, August.
    10. Thomas E. Cooper, 1986. "Most-Favored-Customer Pricing and Tacit Collusion," RAND Journal of Economics, The RAND Corporation, vol. 17(3), pages 377-388, Autumn.
    11. Daly, George G., 1998. "Entrepreneurship and business culture in Japan and the U.S.1," Japan and the World Economy, Elsevier, vol. 10(4), pages 487-494, October.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Kazuhiro Ohnishi, 2014. "Sequential Mixed Competition with a Foreign Joint-stock Firm," International Journal of Social Sciences and Management Studies (IJSSMS), The Economics and Social Development Organization (TESDO), vol. 1(2), pages 38-52, June.
    2. Ohnishi, Kazuhiro, 2018. "Inventory Holding and a Mixed Duopoly with a Foreign Joint-Stock Firm," MPRA Paper 88223, University Library of Munich, Germany.
    3. Ohnishi, Kazuhiro, 2022. "Socially concerned duopolies with lifetime employment as a strategic commitment," MPRA Paper 111625, University Library of Munich, Germany.
    4. Kazuhiro Ohnishi, 2009. "Capacity Investment and Mixed Duopoly with State-Owned and Labor-Managed Firms," Annals of Economics and Finance, Society for AEF, vol. 10(1), pages 49-64, May.
    5. Kazuhiro Ohnishi, 2010. "Partial privatization in price-setting mixed duopoly," Economics Bulletin, AccessEcon, vol. 30(1), pages 309-314.
    6. Kazuhiro Ohnishi, 2011. "A Quantity-Setting Mixed Duopoly with Inventory Investment as a Coordination Device," Annals of Economics and Finance, Society for AEF, vol. 12(1), pages 109-119, May.
    7. Kazuhiro Ohnishi, 2019. "Capacity choice in an international mixed triopoly," Working Papers e140, Tokyo Center for Economic Research.
    8. Liu, Yi & Tan, Yu & Fang, Yu, 2019. "Innovation spillover, licensing, and ex-post privatization in international duopoly," MPRA Paper 95467, University Library of Munich, Germany.
    9. Kazuhiro Ohnishi, 2009. "Strategic Commitment and Three-Stage Games with Labour-Managed and Profit-Maximizing Firms," Finnish Economic Papers, Finnish Economic Association, vol. 22(2), pages 63-74, Autumn.
    10. repec:ebl:ecbull:v:30:y:2010:i:1:p:309-314 is not listed on IDEAS
    11. Ohnishi, Kazuhiro, 2019. "Capacity choice in an international mixed triopoly," MPRA Paper 94051, University Library of Munich, Germany.
    12. Ohnishi, Kazuhiro, 2021. "Lifetime employment and reaction functions of socially concerned firms under quantity competition," MPRA Paper 110867, University Library of Munich, Germany.

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    More about this item

    Keywords

    mixed duopoly; lifetime employment contract; Cournot model;
    All these keywords.

    JEL classification:

    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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