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Information Exchanges among Firms and Their Welfare Implications (Part 3） : Private Risks and Oligopoly Models

Author

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  • Yasuhiro Sakai

    (Faculty of Economics, Shiga University)

Abstract

The long series of papers on the information exchanges among firms and their welfare implications contain three parts, namely Part I, Part II and Part III. In the previous papers, we already discussed Parts I and II. Part I was concerned with the basic dual relations between the Cournot and Bertrand models. Part II dealt with the world of risk and uncertainty, focusing on the Cournot duopoly model with a common demand risk as a starting point. It then explored other types of duopoly models with a common risk. The purpose of this paper is to discuss more complicated problems such as private risks and oligopoly models. When there exist more than two firms in an industry, the problem of the information exchange among firms becomes more complicated yet more intriguing. It will be seen that as the number of "producers as insiders" rises, the possibility of "consumers as outsiders" gaining their welfare is likely to increase. This is certainly the result which may agree with common sense. Some policy implications of our analysis will also be investigated.

Suggested Citation

  • Yasuhiro Sakai, 2016. "Information Exchanges among Firms and Their Welfare Implications (Part 3） : Private Risks and Oligopoly Models," Discussion Papers CRR Discussion Paper Series A: General 18, Shiga University, Faculty of Economics,Center for Risk Research.
    • Handle: RePEc:shg:dpapea:18
    as

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    File URL: https://www.econ.shiga-u.ac.jp/risk/DPA18sakai20160525.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    Keywords

    Duopoly・Cournot; Bertrand; common risk; information exchanges;
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