Price competition with population uncertainty
AbstractThe Bertrand paradox holds that price competition among at least two firms eliminates all profits in equilibrium, when firms have identical constant marginal costs. This assumes that the number of competitors is common knowledge among firms. If firms are uncertain about the number of their competitors, there is no pure strategy equilibrium. But in mixed strategies an equilibrium exists. In this equilibrium it takes a large market to wipe out profits. Thus, with population uncertainty, two are not enough for competition.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Elsevier in its journal Mathematical Social Sciences.
Volume (Year): 58 (2009)
Issue (Month): 2 (September)
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505565
Bertrand paradox Population uncertainty Price competition;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Simon, Leo K & Zame, William R, 1990.
"Discontinuous Games and Endogenous Sharing Rules,"
Econometric Society, vol. 58(4), pages 861-72, July.
- Simon, Leo K. & Zame, William R., 1987. "Discontinous Games and Endogenous Sharing Rules," Department of Economics, Working Paper Series qt8n46v2wv, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Leo K. Simon and William R. Zame., 1987. "Discontinuous Games and Endogenous Sharing Rules," Economics Working Papers 8756, University of California at Berkeley.
- Roger B. Myerson, 1994.
"Population Uncertainty and Poisson Games,"
1102, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Milchtaich, Igal, 2004. "Random-player games," Games and Economic Behavior, Elsevier, vol. 47(2), pages 353-388, May.
- Spulber, Daniel F, 1995. "Bertrand Competition When Rivals' Costs Are Unknown," Journal of Industrial Economics, Wiley Blackwell, vol. 43(1), pages 1-11, March.
- Eric Rasmusen, 1996.
"Bertrand Competition Under Uncertainty,"
- Maarten C.W. Janssen & Eric Rasmusen, 1998. "Bertrand Competition under Uncertainty," Tinbergen Institute Discussion Papers 98-083/1, Tinbergen Institute.
- Maarten Janssen & Eric Rasmusen, 2001. "Bertrand Competition Under Uncertainty," CIRJE F-Series CIRJE-F-117, CIRJE, Faculty of Economics, University of Tokyo.
- Maarten Janssen & Eric Rasmusen, 2000. "Bertrand Competition Under Uncertainty," Econometric Society World Congress 2000 Contributed Papers 1309, Econometric Society.
- Myerson, Roger B., 2000.
"Large Poisson Games,"
Journal of Economic Theory,
Elsevier, vol. 94(1), pages 7-45, September.
- Hoernig, Steffen H., 2002. "Mixed Bertrand equilibria under decreasing returns to scale: an embarrassment of riches," Economics Letters, Elsevier, vol. 74(3), pages 359-362, February.
- Dasgupta, Partha & Maskin, Eric, 1986. "The Existence of Equilibrium in Discontinuous Economic Games, II: Applications," Review of Economic Studies, Wiley Blackwell, vol. 53(1), pages 27-41, January.
- Dasgupta, Partha & Maskin, Eric, 1986. "The Existence of Equilibrium in Discontinuous Economic Games, I: Theory," Review of Economic Studies, Wiley Blackwell, vol. 53(1), pages 1-26, January.
- Thepot, Jacques, 1995. "Bertrand oligopoly with decreasing returns to scale," Journal of Mathematical Economics, Elsevier, vol. 24(7), pages 689-718.
- Blume, Andreas, 2003. "Bertrand without fudge," Economics Letters, Elsevier, vol. 78(2), pages 167-168, February.
- Francesco De Sinopoli & Claudia Meroni & Carlos Pimienta, 2014. "Strategic Stability in Poisson Games," Discussion Papers 2014-09, School of Economics, The University of New South Wales.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If references are entirely missing, you can add them using this form.