Logo
Munich Personal RePEc Archive

Relative profit maximization in asymmetric oligopoly: Cournot and Bertrand equilibria

Satoh, Atsuhiro and Tanaka, Yasuhito (2014): Relative profit maximization in asymmetric oligopoly: Cournot and Bertrand equilibria.

[thumbnail of MPRA_paper_55883.pdf]
Preview
PDF
MPRA_paper_55883.pdf

Download (50kB) | Preview

Abstract

We analyze Bertrand and Cournot equilibria in an asymmetric oligopoly with more than two firms in which the firms produce differentiated substitutable goods and seek to maximize their relative profits instead of their absolute profits. Assuming linear demand functions and constant marginal costs we show the following results. If the marginal cost of a firm is lower (higher) than the average marginal cost over the industry, its output at the Bertrand equilibrium is larger (smaller) than that at the Cournot equilibrium, and the price of its good at the Bertrand equilibrium is lower (higher) than that at the Cournot equilibrium.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.