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Beyond myopic best response (in Cournot competition)

Author

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  • Fiat, Amos
  • Koutsoupias, Elias
  • Ligett, Katrina
  • Mansour, Yishay
  • Olonetsky, Svetlana

Abstract

The Nash equilibrium as a prediction myopically ignores the possibility that deviating from the equilibrium could lead to an avalanche of beneficial changes by other agents.

Suggested Citation

  • Fiat, Amos & Koutsoupias, Elias & Ligett, Katrina & Mansour, Yishay & Olonetsky, Svetlana, 2019. "Beyond myopic best response (in Cournot competition)," Games and Economic Behavior, Elsevier, vol. 113(C), pages 38-57.
    • Handle: RePEc:eee:gamebe:v:113:y:2019:i:c:p:38-57
    DOI: 10.1016/j.geb.2013.12.006
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    References listed on IDEAS

    as
    1. Fershtman, Chaim & Judd, Kenneth L & Kalai, Ehud, 1991. "Observable Contracts: Strategic Delegation and Cooperation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 32(3), pages 551-559, August.
    2. Kurz, Mordecai, 1977. "Distortion of preferences, income distribution, and the case for a linear income tax," Journal of Economic Theory, Elsevier, vol. 14(2), pages 291-298, April.
    3. Vickers, John, 1985. "Delegation and the Theory of the Firm," Economic Journal, Royal Economic Society, vol. 95(380a), pages 138-147, Supplemen.
    4. Fershtman, Chaim & Judd, Kenneth L, 1987. "Equilibrium Incentives in Oligopoly," American Economic Review, American Economic Association, vol. 77(5), pages 927-940, December.
    5. Michael H. Riordan, 1985. "Imperfect Information and Dynamic Conjectural Variations," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 41-50, Spring.
    6. Steven D. Sklivas, 1987. "The Strategic Choice of Managerial Incentives," RAND Journal of Economics, The RAND Corporation, vol. 18(3), pages 452-458, Autumn.
    7. R. D. Theocharis, 1960. "On the Stability of the Cournot Solution on the Oligopoly Problem," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 27(2), pages 133-134.
    8. Berr, Fabian, 2011. "Stackelberg equilibria in managerial delegation games," European Journal of Operational Research, Elsevier, vol. 212(2), pages 251-262, July.
    9. Abreu, Dilip, 1986. "Extremal equilibria of oligopolistic supergames," Journal of Economic Theory, Elsevier, vol. 39(1), pages 191-225, June.
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    Cited by:

    1. Zhengyang Liu & Haolin Lu & Liang Shan & Zihe Wang, 2024. "On the Oscillations in Cournot Games with Best Response Strategies," Papers 2410.09435, arXiv.org.

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    More about this item

    Keywords

    Cournot competition; Bertrand competition; Delegation games; Dynamics;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General

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