Trade in bilateral oligopoly with endogenous market formation
AbstractWe study a strategic market game in which traders are endowed with both a good and money and can choose whether to buy or sell the good. We derive conditions under which a non-autarkic equilibrium exists and when the only equilibrium is autarky. Autarky is â€˜niceâ€™ (robust to small perturbations in the game) when it is the only equilibrium, and â€˜very niceâ€™ (robust to large perturbations) when no gains from trade exist. We characterize economies where autarky is nice but not very nice; that is, when gains from trade exist and yet no trade takes place.
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Bibliographic InfoPaper provided by University of Strathclyde Business School, Department of Economics in its series Working Papers with number 1104.
Length: 20 pages
Date of creation: Feb 2011
Date of revision:
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More information through EDIRC
Bilateral oligopoly; strategic market game; trade.;
Other versions of this item:
- Dickson, Alex & Hartley, Roger, 2011. "Trade in bilateral oligopoly with endogenous market formation," SIRE Discussion Papers 2011-12, Scottish Institute for Research in Economics (SIRE).
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-03-12 (All new papers)
- NEP-COM-2011-03-12 (Industrial Competition)
- NEP-GTH-2011-03-12 (Game Theory)
- NEP-INT-2011-03-12 (International Trade)
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.:
- Peck, James & Shell, Karl & Spear, Stephen E., 1992. "The market game: existence and structure of equilibrium," Journal of Mathematical Economics, Elsevier, vol. 21(3), pages 271-299.
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