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Kadohognon Sylvain Ouattara
''Incentives to merge in asymmetric mixed oligopoly''
( 2015, Vol. 35 No.2 )
This paper analyzes mergers incentives in an asymmetric mixed oligopoly consisting of two identical private firms and one public firm. It is shown that when there is a technological gap between the public and private firms, both of them will want to merge when the public firm is inefficient and the percentage of the shares owned by private owners after the merger is relatively high. When all firms have identical technology, public and private firms will want to merge when the percentage of the shares owned by private owner in the merged entity is relatively low (Artz et al. 2009). Yet, we show that when the technological gap is high enough, the merger between the public firm and one private firm often includes complete privatization.
Keywords: Mixed Oligopoly; Mergers; Quadratic Cost; Efficiency
L3 - Nonprofit Organizations and Public Enterprise: General
Manuscript Received : Feb 17 2015 Manuscript Accepted : Apr 09 2015

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