The chapter considers the introduction of a mixed ownership firm into a classic model in which downstream firms locate strategically so as to achieve accommodating upstream price reductions. These reductions happen endogenously but the strategic locations harm welfare. It shows that a mixed...

We show that partially privatizing a public firm alters underlying conjectures, in turn, changing the optimal degree of privatization. The consistent conjectures equilibrium (CCE) generates substantially greater optimal privatization than does any conjecture shared between the firms including...

Previous research examining mixed duopolies shows that the use of an optimal incentive contract for the public firm increases welfare and that privatization reduces welfare. We demonstrate that these results do not generalize to a mixed oligopoly with multiple private firms. We derive the...