Price or Quantity in Tacit Collusion?
AbstractWe investigate the choice of market variable, price or quantity, of an optimal implicit cartel. If the discount factor is high, the cartel can realize the monopoly profit in both cases. Otherwise, it is optimal for the cartel to rely on quantities in the collusive phase if goods are substitutes and prices if goods are complements. The reason is that this minimizes the gains from deviations from collusive play.
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 University of Copenhagen. Department of Economics. Centre for Industrial Economics in its series CIE Discussion Papers with number 2001-05.
Length: 7 pages
Date of creation: Oct 2001
Date of revision:
Contact details of provider:
Postal: Øster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark
Phone: (0045) 35 32 30 54
Fax: +45 35 32 30 00
Web page: http://www.econ.ku.dk/cie/
More information through EDIRC
Partial collusion; product differentiation;
Other versions of this item:
- 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
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.:
- Deneckere, R., 1983. "Duopoly supergames with product differentiation," Economics Letters, Elsevier, vol. 11(1-2), pages 37-42.
- Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
- Friedman, James W, 1971. "A Non-cooperative Equilibrium for Supergames," Review of Economic Studies, Wiley Blackwell, vol. 38(113), pages 1-12, January.
- Rothschild, R., 1992. "On the sustainability of collusion in differentiated duopolies," Economics Letters, Elsevier, vol. 40(1), pages 33-37, September.
- Majerus, David W., 1988. "Price vs. quantity competition in oligopoly supergames," Economics Letters, Elsevier, vol. 27(3), pages 293-297.
- Albaek, Svend & Lambertini, Luca, 1998. "Collusion in differentiated duopolies revisited," Economics Letters, Elsevier, vol. 59(3), pages 305-308, June.
- Alessandra Chirco & Caterina Colombo & Marcella Scrimitore, 2013. "Organizational Structure and the Choice of Price vs. Quantity in a Mixed Duopoly," Working Paper Series 27_13, The Rimini Centre for Economic Analysis.
- L. Lambertini & G. Rossini, 2004.
"The gains from cooperative R&D with a concave technology and spillovers,"
508, Dipartimento Scienze Economiche, Universita' di Bologna.
- Luca Lambertini & Gianpaolo Rossini, 2009. "The Gains From Cooperative R&D With A Concave Technology And Spillovers," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 11(01), pages 77-85.
- S. Baldelli & L. Lambertini, 2004. "The gains from cooperative R&D with a concave technology and spillovers," Working Papers 510, Dipartimento Scienze Economiche, Universita' di Bologna.
- Luís Aguiar-Conraria & Yi Wen, 2011.
"OPEC’s oil exporting strategy and macroeconomic (in)stability,"
2011-013, Federal Reserve Bank of St. Louis.
- Aguiar-Conraria, Luís & Wen, Yi, 2012. "OPEC's oil exporting strategy and macroeconomic (in)stability," Energy Economics, Elsevier, vol. 34(1), pages 132-136.
- Luís Francisco Aguiar & Yi Wen, 2011. "OPEC´s Oil Exporting Strategy and Macroeconomic (In)Stability," NIPE Working Papers 10/2011, NIPE - Universidade do Minho.
- Hyytinen, Ari & Steen, Frode & Toivanen, Otto, 2013.
"Anatomy of Cartel Contracts,"
CEPR Discussion Papers
9362, C.E.P.R. Discussion Papers.
- Baldelli, Serena & Lambertini, Luca, 2006. "Price vs quantity in a duopoly supergame with Nash punishments," Research in Economics, Elsevier, vol. 60(3), pages 121-130, September.
- Scrimitore, Marcella, 2013. "Price or quantity? The strategic choice of subsidized firms in a mixed duopoly," Economics Letters, Elsevier, vol. 118(2), pages 337-341.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Hoffmann).
If references are entirely missing, you can add them using this form.