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Green transformation in oligopoly markets under common ownership

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  • Hirose, Kosuke
  • Matsumura, Toshihiro

Abstract

A theoretical investigation is conducted on how common ownership (or the extent of cooperation in an industry) affects firms' incentives to adopt green fuel in an oligopoly. The findings show that common ownership hinders the switch from brown to green fuels in two ways. First, an increase in the degree of common ownership reduces a firm's incentive to adopt green fuel. Second, an increase in the degree of common ownership induces a production substitution from green to brown fuel firms. Both these effects reduce the share of green fuel.

Suggested Citation

  • Hirose, Kosuke & Matsumura, Toshihiro, 2022. "Green transformation in oligopoly markets under common ownership," MPRA Paper 115224, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:115224
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    References listed on IDEAS

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    Cited by:

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    2. Yi Liu & Toshihiro Matsumura, 2024. "Welfare effects of common ownership in an international duopoly," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 57(2), pages 459-477, May.
    3. Hirose, Kosuke & Matsumura, Toshihiro, 2024. "Optimal Energy-Saving Investments and Jevons Paradox in Duopoly Markets," MPRA Paper 121836, University Library of Munich, Germany.
    4. Zhengang Zhang & Peilun Li & Liangxiong Huang & Yichen Kang, 2024. "The impact of artificial intelligence on green transformation of manufacturing enterprises: evidence from China," Economic Change and Restructuring, Springer, vol. 57(4), pages 1-36, August.
    5. Hirose, Kosuke & Ishihara, Akifumi & Matsumura, Toshihiro, 2024. "Tax versus regulations: Polluters’ incentives for loosening industry emission targets," Energy Economics, Elsevier, vol. 136(C).
    6. Liu, Yi & Matsumura, Toshihiro, 2024. "Payoff interdependence and welfare-improving location diversification," MPRA Paper 120495, University Library of Munich, Germany.

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    More about this item

    Keywords

    green transition; green fuel; brown fuel; competition restricting effect; production substitution;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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