Please use this identifier to cite or link to this item: http://hdl.handle.net/1822/11996

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dc.contributor.authorBrekke, Kurt R.-
dc.contributor.authorSiciliani, Luigi-
dc.contributor.authorStraume, Odd Rune-
dc.date.accessioned2011-03-28T15:33:40Z-
dc.date.available2011-03-28T15:33:40Z-
dc.date.issued2011-
dc.identifier.citationBREKKE, Kurt R. ; SICILIANA, Luigi ; STRAUME, Odd Rune – “Quality competition with profit constraints : do non-profit firms provide higher quality than for-profit firms?” [Em linha]. Braga : Núcleo de Investigação em Políticas Económicas, 2011. [Consult. 28 Mar. 2011]. Disponível em WWW: <URL: http://www3.eeg.uminho.pt/economia/nipe/docs/2011/NIPE_WP_05_2011.pdf>.por
dc.identifier.urihttp://hdl.handle.net/1822/11996-
dc.description.abstractIn many markets, such as education, health care and public utilities, firms are often profit-constrained either due to regulation or because they have non-profit status. At the same time such firms might have altruistic concerns towards consumers. In this paper we study semi-altruistic firms’ incentives to invest in quality and cost-reducing effort when facing constraints on the distribution of profits. Using a spatial competition framework, we derive the equilibrium outcomes under both quality competition with regulated prices and quality price competition. Profit constraints always lead to lower cost-efficiency, whereas the effects on quality and price are ambiguous. If altruism is high (low), profit-constrained firms offer higher (lower) quality and lower (higher) prices than firms that are not profit-constrained. Compared with the first-best outcome, the cost-efficiency of profit-constrained firms is too low, while quality might be over- or underprovided. Profit constraints may improve welfare and be a complement or substitute to a higher regulated price, depending on the degree of altruism.por
dc.description.sponsorshipFundação para a Ciência e a Tecnologia (FCT)por
dc.language.isoengpor
dc.publisherUniversidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)por
dc.rightsopenAccesspor
dc.subjectProfit constraints Semi-altruistic providerspor
dc.subjectQuality competitionpor
dc.subjectSemi-altruistic providerspor
dc.titleQuality competition with profit constraints : do non-profit firms provide higher quality than for-profit firms?por
dc.typeworkingPaperpor
dc.peerreviewednopor
dc.relation.publisherversionhttp://www3.eeg.uminho.pt/economia/nipe/docs/2011/NIPE_WP_05_2011.pdfpor
oaire.citationIssueNIPE-WP 05/2011por
oaire.citationTitleNIPE - Working Paperspor
Appears in Collections:NIPE - Documentos de Trabalho

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