Fanti, Luciano and Gori, Luca (2011): Stability analysis in a Cournot duopoly with managerial sales delegation and bounded rationality.
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The present study analyses the dynamics of a Cournot duopoly with managerial sales delegation and bounded rational players. We find that when firms’ owners hire a manager and delegate the output decisions to him, the unique Cournot-Nash equilibrium is more likely to be destabilised (through a flip bifurcation) than when firms maximise profits. Moreover, highly periodicity and deterministic chaos can also occur as the managers’ bonus increases.
|Item Type:||MPRA Paper|
|Original Title:||Stability analysis in a Cournot duopoly with managerial sales delegation and bounded rationality|
|English Title:||Stability analysis in a Cournot duopoly with managerial sales delegation and bounded rationality|
|Keywords:||Bifurcation; Chaos; Cournot; Duopoly; Managerial incentive contracts|
|Subjects:||L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L13 - Oligopoly and Other Imperfect Markets
D - Microeconomics > D4 - Market Structure and Pricing > D43 - Oligopoly and Other Forms of Market Imperfection
C - Mathematical and Quantitative Methods > C6 - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C62 - Existence and Stability Conditions of Equilibrium
|Depositing User:||Luca Gori|
|Date Deposited:||02. Oct 2011 02:54|
|Last Modified:||16. Feb 2013 07:01|
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