We study a standard duopoly model of simultaneous divisionalization and Cournot competition, assuming that firms have different marginal costs divisions are costless. obtain in equilibrium only the efficient firm active because price is equal to cost inefficient firm. In sequential case, however, this “entry-deterrence” strategy profitable for when its advantage important enough. So our setting...

We analyze Cournot competition under demand uncertainty. We show that under rather general assumptions, the game has no asymmetric equilibria but multiple symmetric equilibria. Multiplicity is caused by the requirement of nonnegative prices and remains an issue also for simple demand specifications, such as the linear case. We then show that uniqueness of equilibrium is guaranteed if uncertaint...

We revisit the two-stage duopoly game with strategic delegation and asymmetric technologies of Sen and Stamatopoulos (2015). We show that their conclusions are misled by the restrictive assumption that the extent of delegation to managers is restricted to a binary set. Allowing for a continuous set of delegation incentives, we prove that the delegation stage is a prisoners’dilemma, the unique s...

We characterize the product line choice and pricing of a monopolist as the upper envelope of net marginal revenue curves to the individual product demand functions. The equilibrium product varieties to include in a product line are those yielding the highest upper envelope. In a central case (corresponding to a generalized vertical differentiation framework), the equilibrium range of...

The approach used in this study involves applying the Cournot model, which is initially based on analysis of product quantities market. Building upon obtained equilibrium, a second conducted to examine impact open innovation integration rate, utilizing dynamic model. results have demonstrated that multiple equilibria are possible, and under certain conditions, competing firms stake carefully an...

The paper describes an experiment designed to test if the equilibrium in a market characterized by capacity precommitment followed by price competition, as in the Kreps and Scheinkman model, conforms with the outcome predicted by that model, which is that capacities coincide with Cournot output levels. Sessions were run with capacity precommitment in inexperienced and experienced triopoly marke...

We analyze strategic delegation in a Stackelberg model with an arbitrary number, n, of firms. We show that n − 1 firms delegate their production decisions and only one firm (the one whose manager is the first mover) does not. The later a manager commits to a quantity, the higher his incentive rate. Letting ui denote the equilibrium payoff of the firm whose manager commits in the i-th stage, we ...

This paper proposes a procedure to incorporate the conjectural variation approach in Computable General Equilibrium (CGE) analysis such that the strategic interaction among rival firms in international markets can be modelled. It shows how to calibrate the conjectured reactions of rival domestic and foreign firms. It also shows that the approach suggested by Harrison, Rutherford and Tarr (hence...

We study pricing by multiproduct firms in the context of unregulated monopoly, regulated monopoly and Cournot oligopoly. Using the concept of consumer surplus as a function of quantities (rather than prices), we present simple formulas for optimal prices and show that Cournot equilibrium exists and corresponds to a Ramsey optimum. We then present a tractable class of demand systems that involve...