Abstract
This paper presents construction of a mixed oligopoly model with product differentiation and analyzes the effects of privatization of public firms on the economy under some environmental regulation schemes. Results of our analysis show that the full nationalization of public firm is socially preferred under conditions of no environmental regulation. Partial privatization is socially preferred under both direct and indirect environmental regulations. Moreover, results show that socially preferred privatization depends on the degree of product differentiation under environmental
regulations.
