Flavio Delbono

In this paper, we provide a very simple model to shed light on the issue of managed competition in mixed quasi-markets (i.e. regulated markets in which social and for-profit firms coexist). In doing this, we consider the literature on mixed oligopolies as a reasonable reference point and try to enrich it with the idea of quasi-market. Firstly, our results show that social firms serve the relatively richer portion of the population. Only relatively poor consumers buy units of service from the profit-oriented firm. Secondly, the socially-preferable form of managed competition is to introduce co-production practices and, hence, to raise profit-oriented firm’s production costs. The diffusion of co-production paradigms ensures maximal service quality and eliminates mark-up from the market. Keywords: Quasi-Markets, Competition, Regulation, Mixed Oligopoly, Social Firm. JEL Classification: I18, L13, L84.

In its present formulation the Human Development Index (HDI) is a measure of the well-being of nations considering two fixed reference values for each indicator, the so-called fixed goals of development, as normalization parameters. As is well known, the HDI is insensitive to the relative performance of a country with respect to those of a reference group of nations. Nevertheless, several recent works on individuals’ perception of their well-being reveal that subjective well-being is positively correlated with upward mobility opportunities and negatively correlated with the persistency of well-being inequalities within a reference group. Therefore, in this paper, we suggest an easy-tohandle extension of the HDI aimed at integrating the «absolute» perspective implicit in the traditional index with a relative one. Finally, as an application of our index, we assess the well-being of nations in the EU.