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Oligopoly with Hyperbolic Demand and Capital Accumulation

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  • L. Lambertini

Abstract

A dynamic approach is proposed for the analysis of the Cournot oligopoly game with hyperbolic demand, showing that the adoption of capital accumulation dynamics either `a la Solow-Swan or `a la Ramsey eliminate the indeterminacy problem characterising the static model when marginal costs are nil. It is proved that the steady state equilibria produced by both models are stable in the saddle point sense. Finally, it is also shown that the solutions of the corresponding feedback problems share analogous properties, although they cannot be fully characterised from an analytical standpoint

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  • L. Lambertini, 2009. "Oligopoly with Hyperbolic Demand and Capital Accumulation," Working Papers 672, Dipartimento Scienze Economiche, Universita' di Bologna.
    • Handle: RePEc:bol:bodewp:672
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    1. repec:bla:ecorec:v:78:y:2002:i:243:p:375-80 is not listed on IDEAS
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    9. L. Lambertini, 2010. "Oligopoly with Hyperbolic Demand: A Differential Game Approach," Journal of Optimization Theory and Applications, Springer, vol. 145(1), pages 108-119, April.
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    12. L. Lambertini, 2007. "Volatility forecasting for crude oil futures," Working Papers 598, Dipartimento Scienze Economiche, Universita' di Bologna.
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