摘要：We examine firms' decisions to hire managers in a duopoly where a public firm competes with a foreign private firm. In contrast with the case in which the public firm competes with a domestic private firm -where only the private firm decides to hire a manager-we find that both firms hire managers. This leads to a social welfare higher than the one obtained when neither firm hires a manager.Citation:.Jorge.Fernández-Ruiz, (2009) ''Managerial Delegation in a Mixed Duopoly with a Foreign Competitor'', Economics Bulletin, Vol. 29 no.1 pp. 90-99.Submitted:.Dec.02.2008....Published:February 13, 2009..... var currentpos,timer; function initialize() { timer=setInterval("scrollwindow()",10);} function sc(){clearInterval(timer); }function scrollwindow() { currentpos=document.body.scrollTop; window.scroll(0,++currentpos); if (currentpos != document.body.scrollTop) sc();} document.onmousedown=scdocument.ondblclick=initialize1. Introduction. This paper examines firms' decisions to hire managers when a public firm with social welfare objectives competes with a foreign private firm with profit objectives. The issue of strategic managerial contracting in the context of private firms has been widely analyzed since the early contributions of Fershtman and Judd (1987) and Sklivas (1987), who showed that owners of profit-maximizing-firms have an incentive to hire managers that pursue objectives different from simple profit maximization. By doing so in a publicly observable way, owners pre-commit to a strategy they find profitable when the reaction of their competitors is taken into account. Strategic managerial contracting in the context of mixed markets, where public firms and private firms compete, has been studied by, among others, Barros (1995), White (2001) and Barcena-Ruiz (2007)1. Barros (1995) studies the effects of managerial contracting in a model that includes both agency problems within the firm and strategic motives. White (2001) concentrates on the strategic aspects of managerial contracting and endogenizes firms' decisions to hire managers. Bárcena-Ruiz (2007) follows White's approach and investigates the effect of changing the mode of product-market competition –from Cournot to Bertrand. Our approach is similar to Bárcena-Ruiz (2007) and White (2001), which we closely follow. Most models of mixed markets -including Barros (1995), White (2001) and Bárcena-Ruiz (2007)- assume that private firms are domestic. Some exceptions are Fjell and Pal (1996), Fjell and Heywood (2002) Matsumura (2003) and Lu (2006, 2007), who include foreign private firms. The introduction of such firms into the analysis is important because in reality mixed oligopolies often include them and this inclusion alters the objective function of the public firm. Yet, there is no analysis of the effect of foreign ownership of private firms in the hiring of managers in mixed markets. In this paper we attempt to fill this gap by considering a duopoly consisting of a state-owned firm and a foreign private firm. Our main results are that, if the weight associated to the foreign firm's profits in the social welfare function is low enough, then: i) in contrast with the case in which the private firm is domestic – where the public firm decides not hire a manager- in equilibrium both the public and the foreign private firm hire managers, and ii) this equilibrium is associated with a social welfare higher than the one obtained when neither firm hires a manager. 2. The Model. We consider a duopolistic model in which a public firm (firm 0) and a foreign private firm (firm 1) compete in a homogeneous product market. The inverse demand function is given by ..110qqap..=............................................................1Nakamura and Inoue (2007) and Nishimori and Ogawa (2005) also consider models with managerial contracting in mixed oligopolies, along the lines of Barros (1995) and White (2001). They do not analyze, however, the decision to hire managers, which is the focus of our paper.
