Advertising and Oligopolistic Equilibrium
AbstractThis article analyzes advertising in an n-firm infinite horizon, differentiated products oligopoly. The firms all choose output and advertising levels in each period, and are assumed to behave noncooperatively. Advertising is characterized in a manner similar to capital: the effects of money spent on advertising today last well into the future. The interfirm advertising effect can be either cooperative or predatory, and in a linear-quadratic version of the model, this degree of cooperativeness is represented by a parameter. Existence and uniqueness of the Nash equilibrium are obtained, along with many comparative statics results.
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Bibliographic InfoArticle provided by The RAND Corporation in its journal Bell Journal of Economics.
Volume (Year): 14 (1983)
Issue (Month): 2 (Autumn)
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Web page: http://www.rje.org
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- Harrison, Teresa & Laincz, Chris, 2013. "Nonprofits, Crowd-Out, and Credit Constraints," Department of Economics Working Paper Series 2013-5, LeBow College of Business, Drexel University.
- Erickson, Gary M., 1995. "Differential game models of advertising competition," European Journal of Operational Research, Elsevier, vol. 83(3), pages 431-438, June.
- Feng Yao, 2012. "The Effect of Advertising on Collusion in the U.S. Brewing Industry: A Trigger Strategy Approach," Atlantic Economic Journal, International Atlantic Economic Society, vol. 40(1), pages 21-37, March.
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