Please use this identifier to cite or link to this item: https://hdl.handle.net/10216/91369
Author(s): Fernanda A. Ferreira
Flávio Ferreira
Miguel Ferreira
Alberto A. Pinto
Title: Quantity Competition in a Differentiated Duopoly
Issue Date: 2009
Abstract: In this paper, we consider a Stackelberg duopoly competition with differentiated goods, linear and symmetric demand and with unknown costs. In our model, the two firms play a non-cooperative game with two stages: in a first stage, firm F 1 chooses the quantity, q 1, that is going to produce; in the second stage, firm F 2 observes the quantity q 1 produced by firm F 1 and chooses its own quantity q 2. Firms choose their output levels in order to maximise their profits. We suppose that each firm has two different technologies, and uses one of them following a certain probability distribution. The use of either one or the other technology affects the unitary production cost. We show that there is exactly one perfect Bayesian equilibrium for this game. We analyse the variations of the expected profits with the parameters of the model, namely with the parameters of the probability distributions, and with the parameters of the demand and differentiation.
Description: In this paper, we consider a Stackelberg duopoly competition with differentiated goods, linear and symmetric demand and with unknown costs. In our model, the two firms play a non-cooperative game with two stages: in a first stage, firm F 1 chooses the quantity, q 1, that is going to produce; in the second stage, firm F 2 observes the quantity q 1 produced by firm F 1 and chooses its own quantity q 2. Firms choose their output levels in order to maximise their profits. We suppose that each firm has two different technologies, and uses one of them following a certain probability distribution. The use of either one or the other technology affects the unitary production cost. We show that there is exactly one perfect Bayesian equilibrium for this game. We analyse the variations of the expected profits with the parameters of the model, namely with the parameters of the probability distributions, and with the parameters of the demand and differentiation.
Subject: Matemática
Mathematics
Scientific areas: Ciências exactas e naturais::Matemática
Natural sciences::Mathematics
URI: https://repositorio-aberto.up.pt/handle/10216/91369
Source: Intelligent Engineering Systems and Computational Cybernetics
Document Type: Capítulo ou Parte de Livro
Rights: restrictedAccess
Appears in Collections:FCUP - Capítulo ou Parte de Livro

Files in This Item:
File Description SizeFormat 
48228.pdf
  Restricted Access
3.6 MBAdobe PDF    Request a copy from the Author(s)


Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.