Taxpayer-consumers and public pricing. (English) Zbl 0896.90025
Summary: Public ownership may be viewed as a device to allocate control rights over a firm’s prices in a democratic manner. We analyze pricing when the public firm is controlled by majority voting and losses are covered by income taxation. If median and mean income coincide, marginal-cost pricing is selected. Otherwise, a Ramsey-style pricing rule obtains.
MSC:
| 91B24 | Microeconomic theory (price theory and economic markets) |
References:
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