Document Type : Original Research


Institute for Basic Economic Science, Osaka, Japan


This paper examines a mixed duopoly model in which a state-owned firm competes with a joint-stock firm. The following two stages are considered. In the first stage, each firm can simultaneously and independently decide whether or not to offer lifetime employment as a strategic commitment. In the second stage, each firm simultaneously and independently chooses its actual output. The paper shows that there are two equilibrium solutions in the model.


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