In this not we show that the results developed in Singh and Vives (1984) are sensitive to the duopoly assumtion (Rand Journal of Economics 15, 546-554). If there are more than two firms, prices may be higher under price competition than unde quantity competition. This will be the case if quality differences are large and goods are complements. If goods are substitutes, high-quality fims may earn higher profits unde price competion than under quantity competition. Hence, it is not evident which kind of competition is more efficient.
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Paper provided by Stockholm University, Department of Economics in its series Research Papers in Economics with number
1999:9.
Length: 8 pages Date of creation: 17 Aug 1999 Date of revision: Publication status: Published in Journal of Economic Theory, 2000, pages 233-239. Handle: RePEc:hhs:sunrpe:1999_0009
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Find related papers by JEL classification: D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
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Cited by: (explanations, 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.)
Etienne Billette de Villemeur & Laurent Flochel & Bruno Versaevel, 2009.
"Optimal Collusion with Limited Severity Constraint,"
Working Papers
0909, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
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