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Title:Regulating national firms in a common market PDF Logo
Authors:Biancini, Sara
Issue Date:2008
Series/Report no.:CESifo working paper 2209
Abstract:We consider the regulation of national firms in a common market. Regulators can influence the production of national firms but they incur in a positive cost of public funds. First, we show that market integration is welfare improving if and only if the efficiency gains compensate for the negative public finance effect (related to business stealing). We also show that supranational competition can have very different consequences on the rent seeking behaviour of firms, depending on cost correlation and ex-ante technological risk. Finally, we characterize the global optimum and show how it can be sustained in a decentralized bargaining solution.
market integration
cost of public funds
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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