Abstract

We investigate how market competition affects the incentive to adopt a non-profit-maximizing behaviour. The analysis is developed in a strategic delegation framework in which owners delegate output decisions to managers interested in firm's relative performance. We study how the optimal delegation scheme is affected by market concentration and the elasticity of market demand. We prove that the distortion from a profit-maximizing rule decreases as market becomes less concentrated, while it increases as demand becomes more elastic. Finally, we discuss the impact of market competitiveness on the welfare-enhancing ability of delegation contracts. Codice Scopus: 2-s2.0-80054752522

Autore Pugliese

• Chirco Alessandra , Scrimitore Marcella

Tutti gli autori

• A. Chirco , C. Colombo , M. Scrimitore

Titolo volume/Rivista

METROECONOMICA

Anno di pubblicazione

2011

ISSN

0026-1386

ISBN

Non Disponibile

Numero di citazioni Wos

4

Ultimo Aggiornamento Citazioni

28/04/2018

Numero di citazioni Scopus

4

Ultimo Aggiornamento Citazioni

28/04/2018

Settori ERC

Non Disponibile

Codici ASJC

Non Disponibile