Paper #646

Títol:

Price increase and stability with new entries in Cournot markets

Autors:

Ramon Villanova, Jaume Paradís, Pelegrí Viader i Joan Miralles

Data:

Octubre 2002

Resum:

It is widely accepted in the literature about the classical Cournot oligopoly model that the loss of quasi–competitiveness is linked, in the long run as new firms enter the market, to instability of the equilibrium. In this paper, though, we present a model in which a stable unique symmetric equilibrium is reached for any number of oligopolists as industry price increases with each new entry. Consequently, the suspicion that non–quasi–competitiveness implies, in the long run, instability is proved false.

Paraules clau:

Cournot equilibrium, non-cooperative oligopoly, quasi-competitiveness, stability

Codis JEL:

D43,C62

Àrea de Recerca:

Estadística, Econometria i Mètodes Quantitatius

Publicat a:

Keio Economic Studies, 48, 69-96, 2012

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