Oligopolistic Equilibrium and Financial Constraints
AbstractIn this paper we present a model of oligopoly and financial constraints. We study allocations which are bankruptcy-free (BF) in the sense that no firm can drive another firm to bankruptcy without becoming bankrupt. We show how such allocations can be sustained as an equilibrium of a dynamic game. When there are two firms, all equilibria yield BF allocations. When there are more than two firms, allocations other than BF can be sustained as equilibria but in some cases the set of BF allocations still useful in explaining the shape of equilibrium set.
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 InfoPaper provided by Barcelona Graduate School of Economics in its series Working Papers with number 547.
Date of creation: Apr 2011
Date of revision:
Financial Constraints; Bankruptcy; Firm Behavior; Dynamic Games;
Other versions of this item:
- Carmen Beviá & Luis C. Corchón & Yosuke Yasuda, 2011. "Oligopolistic equilibrium and financial constraints," Economics Working Papers we1110, Universidad Carlos III, Departamento de Economía.
- D2 - Microeconomics - - Production and Organizations
- D4 - Microeconomics - - Market Structure and Pricing
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
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.:
- Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, January.
- Etienne Billette de Villemeur & Laurent Flochel & Bruno Versaevel, 2013.
"Optimal collusion with limited liability,"
International Journal of Economic Theory,
The International Society for Economic Theory, vol. 9(3), pages 203-227, 09.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bruno Guallar).
If references are entirely missing, you can add them using this form.