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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/25778
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| Title: | | Government outsourcing: public contracting with private monopoly  |
| Authors: | | Auriol, Emmanuelle Picard, Pierre M. |
| Issue Date: | | 2006 |
| Series/Report no.: | | CESifo working paper 1733 |
| Abstract: | | The paper studies the impact of government budget constraint in a pure adverse selection problem of monopoly regulation. The government maximizes total surplus but incurs some cost of public funds. An alternative to regulation is proposed in which firms are free to enter the market and to choose their price and output levels. However the government can contract ex-post with the private firms. This ex-post contracting set-up allows more flexibility than traditional regulation where government commits to both investment and operation cashflows. This is especially relevant in case of high technological uncertainties. |
| JEL: | | L43 L51 D82 L33 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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