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Economic Integration and Privatization of Publicly-owned Firms

Author

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  • Bárcena Ruiz, Juan Carlos
  • Garzón San Felipe, María Begoña

Abstract

[EN] We analyse in this paper whether it should be the government of each country that decides whether to privatise a publicly-owned firm (non integration) or whether a supra-national authority should decide whether publicly-owned companies in the different countries should be privatised (economic integration). We assume that there are two countries which form a single market in which there is free trade and each country has one publicly-owned company and n private companies. We show that the aggregate social welfare is greater if there is a supra-national authority which decides whether or not privatise publicly-owned companies. Moreover, we obtain that it is better that the publicly-owned companies be owned by the countries in which they are located instead of that these firms be owned by the supranational authority.

Suggested Citation

  • Bárcena Ruiz, Juan Carlos & Garzón San Felipe, María Begoña, 2001. "Economic Integration and Privatization of Publicly-owned Firms," BILTOKI 1134-8984, Universidad del País Vasco - Departamento de Economía Aplicada III (Econometría y Estadística).
    • Handle: RePEc:ehu:biltok:5746
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    File URL: https://addi.ehu.es/handle/10810/5746
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