This paper develops a game theory model of a service-oriented Internet in which profit-maximizing service providers provide substitutable (but not identical) services and compete with the quantities of services in a Cournot-Nash manner, whereas the network transport providers, which transport the services to the users at the demand markets, and are also profit-maximizers, compete with prices in...

This paper considers a duopoly price-choice game in which the unique Nash equilibrium is the Bertrand outcome. Price competition, however, is imperfect in the sense that the market share of the high-price firm is not zero. Economic intuition suggests that price levels should be positively related to the market share of the high-price firm. Although this relationship is not predicted by standard...

We show the existence of Nash equilibria in a Bertrand oligopoly price competition game using a possibly asymmetric attraction demand model with convex costs under mild assumptions. We show that the equilibrium is unique and globally stable. To our knowledge, this is the first paper to show the existence of a unique equilibrium with both non-linear demand and non-linear costs. In addition, we g...

This paper analyzes a simple, repeated game of simultaneous entry and pricing. We report a surprising property of the symmetric equilibrium solution: If the number of potential competitors is increased above two, the market breaks down with higher probability, and the competitive outcome becomes less likely. More potential competition lowers welfare – another Bertrand paradox. The model can als...

Static and dynamic games are important tools for the analysis of strategic interactions among economic agents and have found many applications in economics. In many games equilibria can be described as solutions of polynomial equations. In this paper we describe state-of-the-art techniques for finding all solutions of polynomial systems of equations and illustrate these techniques by computing ...

In this paper, an infinitely-repeated Bertrand game is considered. The model has a two-tier relationship; two firms make a self-enforced collusive agreement and each firm writes a law-enforced contract to its privately-informed agent. The main finding is that in optimal collusion, interaction between intra-firm (internal) contracting and inter-firm collusion may be exploited; inter-firm collusi...

In this paper, we develop a model of collusion in which two firms play an infinitelyrepeated Bertrand game when each firm has a privately-informed agent. The colluding firms, fixing prices, allocate market shares based on the agent’s information as to cost types. We emphasize that the presence of privately-informed agents may provide firms with a strategic opportunity to exploit an interaction ...

This paper develops a theoretical foundation for the undercut-proof equilibrium (see Shy, 1996, 2002; Morgan and Shy, 2013). In a general spatial setting, the set of undercut-proof prices is equivalent the core of a non-transferable utility cooperative-game, played on the set of outcomes that are feasible in Bertrand competition. The result depends critically on two conditions: First, firms mus...

this work, we investigate a Cournot-Bertrand duopoly model with product differentiation between two different firms, where one company uses price as decision variable and the other quantity. The stability of Nash equilibrium point is investigated, role parameters on studied. It shown that system experiences three types bifurcations when go through boundary curves region. Furthermore, model's bi...

Transport markets involve interactions between multiple groups of decision-makers, hence they are good candidates to be analyzed through the prism game theory. The many models and algorithms published date tend reflect different academic disciplines, including operations research, economics engineering approaches. Models in research oriented journals often large network components order provide...