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| Juan Carlos Barcena-Ruiz and María Begoña Garzón |
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| ''Capacity Choice in a Mixed Duopoly under Price Competition'' |
| ( 2007, Vol. 12 No.26 ) |
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| This paper shows that when firms compete on prices in a mixed duopoly, the public firm chooses over-capacity when products are substitutes and under-capacity when products are complements. The private firm always chooses under-capacity. This result is in contrast with that obtained in the literature assuming quantity competition. |
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| Keywords: Heterogeneous Products |
JEL: L3 - Nonprofit Organizations and Public Enterprise: General
D4 - Market Structure and Pricing: General |
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| Manuscript Received : Oct 17 2007 | | Manuscript Accepted : Oct 17 2007 |
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