We develop a model in which two firms from different countries compete on each other domestic market. Each firm is jointly owned by the residents and the government of its country. The extent of the government's stake in the public enterprise is endogenous and it determines the weight given to...

A public-choice model is presented in order to explain the fact that publicly owned electricity utilities rarely price at marginal cost in practice. It is shown that if (1) government revenues are raised through proportional taxes, (2) median income is less than mean income, and (3) the share of...