Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/81244
Authors: 
Norbäck, Pehr-Johan
Persson, Lars
Year of Publication: 
2003
Series/Report no.: 
IUI Working Paper 604
Abstract: 
This paper determines the equilibrium ownership structure in an emerging market deregulated by privatization and investment liberalization. It is shown that bidding competition in the privatization stage is necessary but not sufficient for reaching an efficient equilibrium market structure. Competition in the ensuing entry stage is also necessary. Otherwise, one firm can induce another to take the role of the weak firm in the subsequent product market competition, by making concessions in the bidding in the privatization auction. It is also shown that Employment Guarantees may help the buyer of the privatized firm abstain from investing and by that creating a less competitive market structure.
Subjects: 
Privatization
Ownership
FDI
Auctions
Employment Guarantees
JEL: 
D44
F23
L10
L40
Document Type: 
Working Paper

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