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Oligopoly Equilibrium with differentiated commodities: a computation of two models

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Abstract

In this paper, we define the concept of symmetric Cournot-Walras equilibrium (SCWE thereafter) in a pure exchange economy with differentiated commodities based on Julien and Tricou (2005). We compute this concept of equilibrium to two economies where the oligopolists offer their differentiated goods on the market in order to obtain the competitive good. We obtain three main results. First, we find that, under certain conditions, SCWE-DP allocations and price converge to Walrasian ones. Second, we also find that whether the SCWE-DP is Pareto-dominated or not by Walrasian equilibrium depends on the type of economic agent (oligopolist or competitive). Third, the two economies are linked.

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  • Bio-Akanni ELEGBEDE, 2017. "Oligopoly Equilibrium with differentiated commodities: a computation of two models," Working Papers CREGO 1171201, Université de Bourgogne - CREGO EA7317 Centre de recherches en gestion des organisations.
    • Handle: RePEc:dij:wpfarg:1171201
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    More about this item

    Keywords

    Differentiated commodity; General equilibrium; Cournot-Walras Equilibrium;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L38 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Policy

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