IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/88223.html
   My bibliography  Save this paper

Inventory Holding and a Mixed Duopoly with a Foreign Joint-Stock Firm

Author

Listed:
  • Ohnishi, Kazuhiro

Abstract

This paper investigates a mixed duopoly model in which there is a state-owned firm competing with a foreign joint-stock firm. The following situation is considered. In the first period, each firm non-cooperatively decides how many it sells in the current market. In addition, each firm can hold inventory for the second-period market. By holding large inventory, a firm may be able to commit to large sales in the next period. In the second period, each firm non-cooperatively chooses its second-period output. At the end of the second period, each firm sells its first-period inventory and its second-period output and holds no inventory. The paper traces out the firms’ reaction functions in the mixed duopoly model.

Suggested Citation

  • Ohnishi, Kazuhiro, 2018. "Inventory Holding and a Mixed Duopoly with a Foreign Joint-Stock Firm," MPRA Paper 88223, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:88223
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/88223/1/MPRA_paper_88223.pdf
    File Function: original version
    Download Restriction: no
    File URL: https://mpra.ub.uni-muenchen.de/105315/1/MPRA_paper_105315.pdf
    File Function: revised version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Wang, Leonard F.S. & Wang, Jean, 2009. "Environmental taxes in a differentiated mixed duopoly," Economic Systems, Elsevier, vol. 33(4), pages 389-396, December.
    2. repec:ebl:ecbull:v:12:y:2008:i:28:p:1-10 is not listed on IDEAS
    3. Saloner, Garth, 1987. "Cournot duopoly with two production periods," Journal of Economic Theory, Elsevier, vol. 42(1), pages 183-187, June.
    4. Willner, Johan, 1994. "Welfare maximisation with endogenous average costs," International Journal of Industrial Organization, Elsevier, vol. 12(3), pages 373-386, September.
    5. 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.
    6. repec:ebl:ecbull:v:12:y:2005:i:6:p:1-6 is not listed on IDEAS
    7. Yuanzhu Lu & Sougata Poddar, 2009. "Endogenous Timing In A Mixed Duopoly And Private Duopoly –‘Capacity‐Then‐Quantity’ Game: The Linear Demand Case," Australian Economic Papers, Wiley Blackwell, vol. 48(2), pages 138-150, June.
    8. Meade, James E, 1972. "The Theory of Labour-Managed Firms and of Profit Sharing," Economic Journal, Royal Economic Society, vol. 82(325), pages 402-428, Supplemen.
    9. 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.
    10. Mujumdar, Sudesh & Pal, Debashis, 1998. "Effects of indirect taxation in a mixed oligopoly," Economics Letters, Elsevier, vol. 58(2), pages 199-204, February.
    11. Cremer, Helmuth & Marchand, Maurice & Thisse, Jacques-Francois, 1991. "Mixed oligopoly with differentiated products," International Journal of Industrial Organization, Elsevier, vol. 9(1), pages 43-53, March.
    12. William C. Merrill & Norman Schneider, 1966. "Government Firms in Oligopoly Industries: A Short-Run Analysis," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 80(3), pages 400-412.
    13. Delbono, Flavio & Rossini, Gianpaolo, 1992. "Competition policy vs horizontal merger with public, entrepreneurial, and labor-managed firms," Journal of Comparative Economics, Elsevier, vol. 16(2), pages 226-240, June.
    14. Jorge Fernández-Ruiz, 2009. "Managerial Delegation in a Mixed Duopoly with a Foreign Competitor," Economics Bulletin, AccessEcon, vol. 29(1), pages 90-99.
    15. Debashis Pal & Mark D. White, 1998. "Mixed Oligopoly, Privatization, and Strategic Trade Policy," Southern Economic Journal, John Wiley & Sons, vol. 65(2), pages 264-281, October.
    16. Morley Gunderson, 1979. "Earnings Differentials between the Public and Private Sectors," Canadian Journal of Economics, Canadian Economics Association, vol. 12(2), pages 228-242, May.
    17. Toshihiro Matsumura, 1999. "Cournot Duopoly With Multi‐period Competition: Inventory as a Coordination Device," Australian Economic Papers, Wiley Blackwell, vol. 38(3), pages 189-202, September.
    18. Hikaru Ogawa & Ming Hsin Lin, 2005. "Cost reducing incentives in a mixed duopoly market," Economics Bulletin, AccessEcon, vol. 12(6), pages 1-6.
    19. Artz, Benjamin & Heywood, John S. & McGinty, Matthew, 2009. "The merger paradox in a mixed oligopoly," Research in Economics, Elsevier, vol. 63(1), pages 1-10, March.
    20. 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.
    21. White, Mark D., 1996. "Mixed oligopoly, privatization and subsidization," Economics Letters, Elsevier, vol. 53(2), pages 189-195, November.
    22. Julio J. Rotemberg & Garth Saloner, 1989. "The Cyclical Behavior of Strategic Inventories," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 104(1), pages 73-97.
    23. Hey, John D, 1981. "A Unified Theory of the Behaviour of Profit-Maximising, Labour-Managed and Joint-Stock Firms Operating under Uncertainty," Economic Journal, Royal Economic Society, vol. 91(362), pages 364-374, June.
    24. Chi‐Chur Chao & Eden S. H. Yu, 2006. "Partial Privatization, Foreign Competition, and Optimum Tariff," Review of International Economics, Wiley Blackwell, vol. 14(1), pages 87-92, February.
    25. Kazuhiro Ohnishi, 2010. "Lifetime Employment Contract and Quantity Competition with Profit-Maximizing and Joint-Stock Firms," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 166(3), pages 462-478, September.
    26. Delbono, Flavio & Scarpa, Carlo, 1995. "Upward-Sloping Reaction Functions under Quantity Competition in Mixed Oligopolies," Bulletin of Economic Research, Wiley Blackwell, vol. 47(4), pages 341-346, October.
    27. repec:bla:ausecp:v:41:y:2002:i:3:p:267-81 is not listed on IDEAS
    28. Pal, Debashis, 1998. "Endogenous timing in a mixed oligopoly," Economics Letters, Elsevier, vol. 61(2), pages 181-185, November.
    29. 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.
    30. Prabal Roy chowdhury, 2009. "Mixed Oligopoly with Distortions: First Best with Budget-balance and the Irrelevance Principle," Economics Bulletin, AccessEcon, vol. 29(3), pages 1873-1888.
    31. Akira Nishimori & Hikaru Ogawa, 2002. "Public Monopoly, Mixed Oligopoly and Productive Efficiency," Australian Economic Papers, Wiley Blackwell, vol. 41(2), pages 185-190, June.
    32. John Heywood & Guangliang Ye, 2010. "Optimal privatization in a mixed duopoly with consistent conjectures," Journal of Economics, Springer, vol. 101(3), pages 231-246, November.
    33. Rupayan Pal & Bibhas Saha, 2014. "Mixed Duopoly and Environment," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 16(1), pages 96-118, February.
    34. repec:ebl:ecbull:v:12:y:2007:i:26:p:1-7 is not listed on IDEAS
    35. Toshihiro Matsumura, 2003. "Stackelberg Mixed Duopoly with a Foreign Competitor," Bulletin of Economic Research, Wiley Blackwell, vol. 55(3), pages 275-287, July.
    36. Joanna Poyago-Theotoky, 2001. "Mixed oligopoly, subsidization and the order of firms' moves: an irrelevance result," Economics Bulletin, AccessEcon, vol. 12(3), pages 1-5.
    37. Kenneth Fjell & John S. Heywood, 2002. "Public Stackelberg Leadership in a Mixed Oligopoly with Foreign Firms," Australian Economic Papers, Wiley Blackwell, vol. 41(3), pages 267-281, September.
    38. Kazuhiro Ohnishi, 2008. "Strategic Commitment and International Mixed Competition with Domestic State-owned and Foreign Labor-managed Firms," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 64(4), pages 458-472, December.
    39. Kenneth Fjell & Debashis Pal, 1996. "A Mixed Oligopoly in the Presence of Foreign Private Firms," Canadian Journal of Economics, Canadian Economics Association, vol. 29(3), pages 737-743, August.
    40. Bulow, Jeremy I & Geanakoplos, John D & Klemperer, Paul D, 1985. "Multimarket Oligopoly: Strategic Substitutes and Complements," Journal of Political Economy, University of Chicago Press, vol. 93(3), pages 488-511, June.
    41. Cremer, Helmuth & Cremer, Jacques, 1992. "Duopoly with employee-controlled and profit-maximizing firms: Bertrand vs Cournot competition," Journal of Comparative Economics, Elsevier, vol. 16(2), pages 241-258, June.
    42. Luca Lambertini & Gianpaolo Rossini, 1998. "Capital Commitment and Cournot Competition with Labour‐managed and Profit‐maximising Firms," Australian Economic Papers, Wiley Blackwell, vol. 37(1), pages 14-21, March.
    43. repec:bla:ausecp:v:41:y:2002:i:2:p:185-90 is not listed on IDEAS
    44. Poyago-Theotoky, Joanna, 1998. "R&D Competition in a Mixed Duopoly under Uncertainty and Easy Imitation," Journal of Comparative Economics, Elsevier, vol. 26(3), pages 415-428, September.
    45. Lorenz NETT, 1993. "Mixed Oligopoly With Homogeneous Goods," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 64(3), pages 367-393, July.
    46. Nett, Lorenz, 1994. "Why private firms are more innovative than public firms," European Journal of Political Economy, Elsevier, vol. 10(4), pages 639-653, December.
    47. Leonard F.S. Wang & Jen-yao Lee, 2010. "Partial Privatization, Foreign Competition, and Tariffs Ranking," Economics Bulletin, AccessEcon, vol. 30(3), pages 2405-2412.
    48. Yuanzhu Lu & Sougata Poddar, 2007. "Firm Ownership, Product Differentiation And Welfare," Manchester School, University of Manchester, vol. 75(2), pages 210-217, March.
    49. Yuanzhu Lu, 2007. "Endogenous timing in a mixed oligopoly consisting of a single public firm and foreign competitors," Economics Bulletin, AccessEcon, vol. 12(2), pages 1-7.
    50. 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.
    51. Rudra Sensarma & Bibhas Saha, 2008. "The Distributive Role of Managerial Incentives in a Mixed Duopoly," Economics Bulletin, AccessEcon, vol. 12(28), pages 1-10.
    52. Juan Bárcena-Ruiz, 2007. "Endogenous Timing in a Mixed Duopoly: Price Competition," Journal of Economics, Springer, vol. 91(3), pages 263-272, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ohnishi, Kazuhiro, 2019. "Capacity choice in an international mixed triopoly," MPRA Paper 94051, University Library of Munich, Germany.
    2. Kazuhiro Ohnishi, 2019. "Capacity choice in an international mixed triopoly," Working Papers e140, Tokyo Center for Economic Research.
    3. 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.
    4. 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.
    5. Kazuhiro Ohnishi, 2022. "Lifetime Employment and Stackelberg Mixed Duopoly Games with a Foreign Labour-Managed Competitor," Arthaniti: Journal of Economic Theory and Practice, , vol. 21(1), pages 27-42, June.
    6. Kazuhiro Ohnishi, 2013. "A Two-production-period Model with State-owned and Labour-managed Firms," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 5(1), pages 41-56, April.
    7. 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.
    8. Toshihiro Matsumura & Akira Ogawa, 2010. "On The Robustness Of Private Leadership In Mixed Duopoly," Australian Economic Papers, Wiley Blackwell, vol. 49(2), pages 149-160, June.
    9. Ohnishi, Kazuhiro, 2018. "Stackelberg Mixed Triopoly Games with State-Owned, Labour-Managed and Capitalist Firms," MPRA Paper 88222, University Library of Munich, Germany.
    10. Toshihiro Matsumura & Noriaki Matsushima & Ikuo Ishibashi, 2009. "Privatization and entries of foreign enterprises in a differentiated industry," Journal of Economics, Springer, vol. 98(3), pages 203-219, December.
    11. Toshihiro Matsumura & Daisuke Shimizu, 2010. "Privatization Waves," Manchester School, University of Manchester, vol. 78(6), pages 609-625, December.
    12. Hiroaki Ino & Toshihiro Matsumura, 2010. "What role should public enterprises play in free-entry markets?," Journal of Economics, Springer, vol. 101(3), pages 213-230, November.
    13. Kazuhiro Ohnishi, 2010. "A Three‐Stage International Mixed Duopoly With A Wage‐Rise Contract As A Strategic Commitment," Manchester School, University of Manchester, vol. 78(4), pages 279-289, July.
    14. Ohnishi, Kazuhiro, 2010. "Wage-rise contract and endogenous timing in international mixed duopoly," Research in Economics, Elsevier, vol. 64(2), pages 121-127, June.
    15. Yoshihiro Tomaru & Masayuki Saito, 2010. "Mixed Duopoly, Privatization And Subsidization In An Endogenous Timing Framework," Manchester School, University of Manchester, vol. 78(1), pages 41-59, January.
    16. repec:ebl:ecbull:v:30:y:2010:i:1:p:309-314 is not listed on IDEAS
    17. Kazuhiro Ohnishi, 2010. "Domestic and international mixed models with price competition," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 57(1), pages 1-7, March.
    18. Prabal Roy chowdhury, 2009. "Mixed Oligopoly with Distortions: First Best with Budget-balance and the Irrelevance Principle," Economics Bulletin, AccessEcon, vol. 29(3), pages 1873-1888.
    19. Amarjyoti Mahanta, 2019. "Endogenous strategic variable in a mixed duopoly," Journal of Economics, Springer, vol. 128(1), pages 47-65, September.
    20. Kazuhiro Ohnishi, 2008. "Strategic Commitment and International Mixed Competition with Domestic State-owned and Foreign Labor-managed Firms," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 64(4), pages 458-472, December.
    21. Xu, Lili & Lee, Sang-Ho & Wang, Leonard, 2017. "Strategic Trade and Privatization Policies in Bilateral Mixed Markets," MPRA Paper 80340, University Library of Munich, Germany.

    More about this item

    Keywords

    Inventory holding; state-owned firm; foreign joint-stock firm; reaction curves;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L30 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:88223. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.