Optimal Firms’ Mix in Oligopoly with Twofold Environmental Externality

Quaderni - Working Paper DSE N° 955

20 Pages Posted: 10 Jul 2014

See all articles by Flavio Delbono

Flavio Delbono

University of Bologna - School of Economics, Management, and Statistics

Luca Lambertini

University of Bologna - Department of Economics

Date Written: July 9, 2014

Abstract

We charaterise the socially optimal mix of firms in an oligopoly with both profit-seeking and labour-managed firms. The policy maker faces a twofold externality: (i) production entails the exploitation of a common pool natural resource and (ii) production/consumption pollutes the environment. We study the relationship between firms' mix and social welfare in the Cournot-Nash equilibrium of the industry and the resulting policy implications.

Keywords: mixed oligopoly, pollution, resource extraction

JEL Classification: L13, H23, P13, Q50

Suggested Citation

Delbono, Flavio and Lambertini, Luca, Optimal Firms’ Mix in Oligopoly with Twofold Environmental Externality (July 9, 2014). Quaderni - Working Paper DSE N° 955, Available at SSRN: https://ssrn.com/abstract=2464072 or http://dx.doi.org/10.2139/ssrn.2464072

Flavio Delbono (Contact Author)

University of Bologna - School of Economics, Management, and Statistics ( email )

Strada Maggiore 45
Bologna, 40125
Italy

Luca Lambertini

University of Bologna - Department of Economics ( email )

Strada Maggiore 45
Bologna, 40125
Italy
+39 051 2092600 (Phone)
+39 051 2092664 (Fax)

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