This timely and much-needed Handbook reconsiders an old topic from a fresh perspective, raising a number of new, interesting and worthwhile issues in the wake of ten years of globalization. This comprehensive analysis illustrates that old-style industrial policies whereby the government directly...

This paper attempts to measure the welfare effects associated with the opening of the Finnish market for long-distance voice telephony in 1993. It also focuses on the remaining potential welfare losses associated with imperfect competition in this market. The results suggest that entry benefited...

This paper focuses on the impact of the public sector capital on private sector productivity in Finland. The majority of previous contributions support the public capital hypothesis, i.e. that public capital plays an important role in enhancing private sector productivity. However, the...

Competition in an industry with an upstream natural monopoly infrastructure requires vertical separation. However, this cannot increase welfare unless marginal costs are reduced, given the advantages of vertical integration. It turns out that entry increases marginal costs and has ambiguous...

We add potential intrinsic motivation to an agency model that is applied on public ownership and privatisation. Conventional agency theory suggests private ownership to be superior if pay under public ownership is not performance-related, but the ranking is otherwise reversed. However, we...

The most important economic motive for privatization and liberalization is to reduce costs, which are believed to be higher in a public monopoly for several reasons, including internal rent capture. We assume that there is wage-bargaining both before and after privatization and liberalization....

I analyse the welfare impact of a mixed market with a private or public firm that is characterised by wider objectives or altruism, in the presence of an agency problem. Contrary to some earlier findings, the total surplus turns out to be increasing in the degree of altruism. This impact is...