We show that in a duopoly operating in a congested market, with a general congestion function and an arbitrary distribution of consumer disutility for congestion, there cannot exist an asymmetric Nash equilibrium. We also show that whenever an equilibrium does exist it is unique. Closed form expressions for the symmetric equilibrium prices and profits are provided. JEL Classification Numbers: C...

If an aggregative game satisfies the generalized Hahn conditions, then there exists a unique Nash equilibrium which may not be interior and is globally asymptotically stable under two alternative continuous adjustment processes with non-negativity constraints. JEL Classification Numbers: C72, D43, L13.

If an aggregative game satisfies the generalized Hahn conditions, then there exists a unique Nash equilibrium, which may not be interior and is globally stable under two alternative continuous adjustment processes with non-negativity constraints. JEL Classification Numbers: C72, D43, L13.

We show that equilibrium involuntary unemployment emerges in a multi– stage game model where all market power resides with firms, on both the labour and the output market. Firms decide wages, employment, output and prices, and under constant returns there exists a continuum of subgame perfect Nash equilibria involving unemployment and positive profits. A firm does not undercut the equilibrium w...

We show that in large …nite economies, core allocations can be approximately decentralized as Nash (rather than Walras) equilibrium. We argue that this exercise is an essential complement to asymptotic core equivalence results, because it implies that in some approximate sense individual attempts to manipulate the decentralizing prices cannot be bene…cial, which …ts precisely the interpretation...

We show that there is a unique correlated equilibrium, identical to the unique Nash equilibrium, in the classic Bertrand oligopoly model with homogenous goods and identical marginal costs. This provides a theoretical underpinning for the socalled “Bertrand paradox” as well as its most general formulation to date. Our proof generalizes to asymmetric marginal costs and arbitrarily many players in...

We show that bounded monopoly profits are essential for the uniqueness of the Bertrand paradox (zero profit) outcome. Otherwise, a folk theorem obtains for one-shot homogeneous product Bertrand games: any positive (but finite) payoff vector can be achieved in a symmetric mixed-strategy Nash equilibrium. JEL Numbers: D43, C72

We conduct experiments testing the relationship between excess capacity and pricing in repeated Bertrand-Edgeworth duopolies and triopolies. We systematically vary the experimental markets between low excess capacity (suggesting monopoly) and no capacity constraints (suggesting perfect competition). Controlling for the number of firms, higher production capacity leads to lower prices. However, ...

This paper presents a model to study the interplay of imperfect competition and congestion. Residents live in the city center while they shop and work in subcenters (shopping centers, airports, etc.). Each subcenter offers one differentiated product and one differentiated workplace. Shopping and commuting from the city center to the subcenter requires the use of transport infrastructure that ca...

This paper reports an experiment designed to assess the effects of a rotation in the marginal cost curve on convergence in a repeated Cournot triopoly. Increasing the cost curve’s slope both reduces the serially-undominated set to the Nash prediction, and increases the peakedness of earnings. We observe higher rates of Nash equilibrium play in the design with the steeper marginal cost schedule,...