Journal title ECONOMIA PUBBLICA
Author/s Giuseppe Clerico
Publishing Year 2002 Issue 2002/3 Language Italian
Pages 20 P. File size 93 KB
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Profit maximizing firms can achieve a monopoly position by means of the predatory pricing. Afterwards, the reduction of competition, the private firm can recoup losses through a price higher than the marginal cost. Such an anticompetitive behaviour can be practiced by public enterprise as well. They can follow such strategy in particular when they try and maximize output. However, the public enterprise, having drastically reduced the competition, does not have, generally, any incentive to adopt a price higher than the marginal cost. A similar price, indeed, could incentive the entry of new competitors. Seemingly, the policy followed by the public firm benefits the consumers. In reality, with respect to the economic system as a whole, such a behaviour of the public enterprise can cause an inefficient resource allocation and perverse incentives to the private agents when the public firm benefits of public transfers financed by a general taxation. As public firms have incentives to limit competition, the Antitrust Agency has to intervent to restore and strengthen the competition.
Giuseppe Clerico, Potere di mercato, prezzi predatori e comportamento anticoncorrenziale dell'impresa pubblica in "ECONOMIA PUBBLICA " 3/2002, pp , DOI: