Arbeitspapier
Managerial Incentives and Market Integration
This paper develops a new analytical approach to the old question whether market conditions may influence the internal efficiency of firms. The basic textbook model of the firm is slightly extended to incorporate managers' incentives to reduce production costs in an imperfectly competitive product market. This is done without invoking any agency problem or other form of information asymmetry in firms. The analysis extends Marshallian and Hicksian consumer analysis to managers' demand for leisure in imperfectly competitive environments with a fixed number of firms, and free entry, respectively. Conditions are identified under which product market integration enhances the internal efficiency of firms, and it is shown that market integration is Pareto improving under free entry.
- Language
-
Englisch
- Bibliographic citation
-
Series: IUI Working Paper ; No. 472
- Classification
-
Wirtschaft
General Economics and Teaching
- Event
-
Geistige Schöpfung
- (who)
-
Weibull, Jörgen W.
- Event
-
Veröffentlichung
- (who)
-
The Research Institute of Industrial Economics (IUI)
- (where)
-
Stockholm
- (when)
-
1996
- Handle
- Last update
-
20.09.2024, 8:20 AM CEST
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Weibull, Jörgen W.
- The Research Institute of Industrial Economics (IUI)
Time of origin
- 1996
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