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A Note on Cournot Competition in Differentiated Oligopolies

Author

Listed:
  • Dou Jiangli

    (Center for Research of Private Economy and School of Economics, Zhejiang University, Zheda Road 38, 310027Hangzhou, China)

  • Ye Bing

    (Center for Research of Private Economy and School of Economics, Zhejiang University, Zheda Road 38, 310027Hangzhou, China)

Abstract

In this paper, we study a Cournot competition where there are a group of firms producing a homogeneous product and another group producing a differentiated product. We find that, fixing the total number of firms in the market, each firm’s profit is U-shaped and convex in the number of firms producing the same product when the degree of substitution is large, and each firm’s profit is U-shaped in the cross-price effect parameter when the number of firms producing the same product is large.

Suggested Citation

  • Dou Jiangli & Ye Bing, 2018. "A Note on Cournot Competition in Differentiated Oligopolies," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 18(1), pages 1-8, January.
    • Handle: RePEc:bpj:bejtec:v:18:y:2018:i:1:p:8:n:1
    DOI: 10.1515/bejte-2015-0088
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    References listed on IDEAS

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    More about this item

    Keywords

    Cournot competition; oligopolies; product differentiation;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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