Political manipulation of a public firm's objective function

In the context of a government-owned public firm that competes with a private firm, this paper demonstrates how the government can maximize its true objective by assigning the public firm a different objective function. Interestingly, this assigned objective function need bear no resemblance to the actual objective being sought, enabling the government to disguise a politically unpopular agenda and/or outside influence. (C) 2002 Elsevier Science B.V. All rights reserved.