Cournot Equilibrium Uniqueness: At 0 Discontinuous Industry Revenue and Decreasing Price Flexibility

Pierre Von Mouche*, Takashi Sato

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

We consider the equilibrium uniqueness problem for a large class of Cournot oligopolies with convex cost functions and a proper price function p with decreasing price flexibility. This class allows for (at 0) discontinuous industry revenue and in particular for p (y) = y-α. The paper illustrates in an exemplary way the Selten-Szidarovszky technique based on virtual backward reply functions. An algorithm for the calculation of the unique equilibrium is provided.

Original languageEnglish
JournalInternational game theory review
DOIs
Publication statusPublished - 7 May 2019

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Uniqueness
Flexibility
Industry
Oligopoly
Cost functions
Convex function
Cost Function
Class
Price flexibility
Revenue
Cournot equilibrium
Cost function
Cournot oligopoly

Keywords

  • Cournot oligopoly
  • decreasing price flexibility
  • discontinuous payoff functions
  • equilibrium uniqueness
  • pseudo-concavity
  • Selten-Szidarovszky technique

Cite this

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title = "Cournot Equilibrium Uniqueness: At 0 Discontinuous Industry Revenue and Decreasing Price Flexibility",
abstract = "We consider the equilibrium uniqueness problem for a large class of Cournot oligopolies with convex cost functions and a proper price function p with decreasing price flexibility. This class allows for (at 0) discontinuous industry revenue and in particular for p (y) = y-α. The paper illustrates in an exemplary way the Selten-Szidarovszky technique based on virtual backward reply functions. An algorithm for the calculation of the unique equilibrium is provided.",
keywords = "Cournot oligopoly, decreasing price flexibility, discontinuous payoff functions, equilibrium uniqueness, pseudo-concavity, Selten-Szidarovszky technique",
author = "{Von Mouche}, Pierre and Takashi Sato",
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month = "5",
day = "7",
doi = "10.1142/S0219198919400103",
language = "English",
journal = "International game theory review",
issn = "0219-1989",
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}

Cournot Equilibrium Uniqueness: At 0 Discontinuous Industry Revenue and Decreasing Price Flexibility. / Von Mouche, Pierre; Sato, Takashi.

In: International game theory review, 07.05.2019.

Research output: Contribution to journalArticleAcademicpeer-review

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AU - Sato, Takashi

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AB - We consider the equilibrium uniqueness problem for a large class of Cournot oligopolies with convex cost functions and a proper price function p with decreasing price flexibility. This class allows for (at 0) discontinuous industry revenue and in particular for p (y) = y-α. The paper illustrates in an exemplary way the Selten-Szidarovszky technique based on virtual backward reply functions. An algorithm for the calculation of the unique equilibrium is provided.

KW - Cournot oligopoly

KW - decreasing price flexibility

KW - discontinuous payoff functions

KW - equilibrium uniqueness

KW - pseudo-concavity

KW - Selten-Szidarovszky technique

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