A BEJEAP Contributions article.

Abstract

We analyze a model of repeated franchise bidding for natural monopoly with contestable licensing -- a franchisee holds an (exclusive) license to operate a franchise until another firm offers to pay more for it. In a world where quality is observable but not verifiable, the simple regulatory scheme we describe combines market-like incentives with regulatory oversight to generate efficient outcomes.

Submitted: March 7, 2003 · Accepted: December 4, 2003 · Published: January 17, 2004

Originally published in Contributions to Economic Analysis & Policy.

Recommended Citation

Neeman, Zvika and Orosel, Gerhard Oskar (2004) "Contestable Licensing ," Contributions to Economic Analysis & Policy: Vol. 3 : Iss. 1, Article 1.
Available at: http://www.bepress.com/bejeap/contributions/vol3/iss1/art1