Mixed oligopoly with state holding corporations and consumer-friendly firm

Dong, Quan; Wang, Leonard F.S.

doi:10.1016/j.iref.2019.03.001

Cited by 12 publications

(10 citation statements)

References 31 publications

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“…Bárcena‐Ruiz, Dong, and Wang (2020) considered the optimal privatisation decision when private sector may be foreign owned. Moreover, Dong and Wang (2019) studied the optimal privatisation of a state holding corporation when firms in the private sector adopt corporate social responsibility.…”

Section: Literature Reviewmentioning

confidence: 99%

Profit taxation and the optimal privatisation of state holding corporations

Dong

Wang

2020

Australian Economic Papers

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To examine the optimal privatisation of a state holding corporation when the government imposes a corporate profit tax on firms, we consider a multiplant state holding corporation producing differentiated goods, competing with firms in the private sector that may be uniplant or multiplant. This set up applies to many mixed markets. We find that the optimal privatisation depends on not only the degree of product substitution and the production organisation of firms in the private sector, but also on the profit tax imposed on firms. Specifically, the optimal privatisation degree increases with the profit tax imposed on firms. There is more privatisation when state holding corporations are sold to different investors than when they are sold to a single investor, and when firms in the private sector are multiplant than when they are uniplant. Given the degree of privatisation, the private sector reduces more of its production when responding to a higher profit tax rate. Moreover, the hypothesis of profit tax neutrality holds under the optimal degree of privatisation. The result suggests that the effect of the profit tax in mixed markets can be cushioned by privatisation.

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Section: Literature Reviewmentioning

confidence: 99%

Profit taxation and the optimal privatisation of state holding corporations

Dong

Wang

2020

Australian Economic Papers

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“…In this paper, we examine the firm's strategic choice of CSR in a competitive managerial delegation framework in which a multiproduct company competes vis-a-vis a single plant one. This asymmetric model formulation follows the work by Dong and Wang (2019) and Garcia et al (2020a,b) in which product substitutability or complementarity plays a vital role in determining CSR's strategic level. We then examine and compare simultaneous output choices and sequential output choices when CSR decisions are simultaneous.…”

Section: Introductionmentioning

confidence: 99%

“…In the literature of CSR, the heterogeneity of objectives among multiproducts firms has also emerged as an important research topic in recent literature of CSR. SeeGarcia et al (2020a,b),Kim et al (2019),Dong and Wang (2019) and Bárcena-Ruiz et al (2020) among others.5 CSiR is understood as being reactive as opposed to proactive in addressing corporate issues in relation to CSR that often…”

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Competitive CSR in a strategic managerial delegation game with a multiproduct corporation

2021

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We study the firm's strategic choice of corporate social responsibility (CSR) in a managerial delegation framework where a multiproduct corporation competes against a single plant firm. We examine simultaneousmove versus sequential-move in output choices when CSR decisions are simultaneous. We show that both firms adopt CSR in a simultaneous-move game, whereas only the follower firm adopts CSR (but not the leader firm) in sequential-move games. We also consider an endogenous timing game in output choices between the two firms and show that a simultaneous-move is an equilibrium when the products are substitutes or weak complements, while a single plant firm's leadership is an equilibrium when the products are sufficiently strong complements. Our findings can explain the widely observed phenomenon, in the real world, of different industries in which firms' CSR activities are more or less (even non-CSR or negative CSR) commonly widespread. It also partially helps us understand CSR's strategic motives and its relations with the firm's profits.

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“…Note that we consider consumer surplus as the proxy of CSR, which has been widely utilized in related literature. For more discussion in recent works, see Lambertini and Tampieri (), Leal et al (), Leal et al (), Garcia et al (),and Dong and Wang () among others.…”

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confidence: 99%

“…Recent theoretical study on the multiproduct firms with CSR concerns has just caught the attention of research scholars. For example, see Bárcena‐Ruiz and Garzón (), Fanti and Buccella (), Fanti and Buccella (), Dong et al (), Dong and Wang (), and Garcia et al ().…”

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confidence: 99%

Welfare‐improving cooperation with a consumer‐friendly multiproduct corporation

2020

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This paper considers a multiproduct corporation that adopts consumer-friendly activities and cooperates with single plant firms for improving welfare. Comparing competition and (full or partial) cooperation, we show that full cooperation is socially beneficial if products are strong complements, whereas partial cooperation with a higher consumer-friendly activities is beneficial if products are substitutes. We also examine a sequential choice game of endogenous cooperation in which the multiproduct corporation can induce cooperation and show that our findings are supportive at equilibrium. We finally compare different ownerships of the single plant firms and find that foreign ownership decreases the benefits of cooperation. Therefore, a cooperation with multiproduct corporation should be accompanied with active governmental guideline for promoting consumerfriendly activities.

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Mixed oligopoly with state holding corporations and consumer-friendly firm

Cited by 12 publications

References 31 publications

Profit taxation and the optimal privatisation of state holding corporations

Profit taxation and the optimal privatisation of state holding corporations

Competitive CSR in a strategic managerial delegation game with a multiproduct corporation

Welfare‐improving cooperation with a consumer‐friendly multiproduct corporation

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