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Cournot-Bayesian General Equilibrium: A Radon Measure Approach

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  • David Carfì

    (Department of Mathematics, University of California Riverside, Riverside, CA 92521, USA
    Current address: Department of Economics, University of Messina, Via dei Verdi 91, 98122 Messina, Italy.
    These authors contributed equally to this work.)

  • Alessia Donato

    (Department of Economics, University of Messina, 98122 Messina, Italy
    These authors contributed equally to this work.)

Abstract

In this paper, we consider a Cournot duopoly, in which any firm does not know the marginal costs of production of the other player, as a Bayesian game. In our game, the marginal costs depend on two infinite continuous sets of states of the world. We shall study, before the general case, an intermediate case in which only one player, the second one, shows infinitely many types. Then, we shall generalize to the case in which both players show infinitely many types depending on the marginal costs, where the marginal costs are given by the nature and each actual marginal cost is known only by the respective player. We find, in both cases, the general Nash equilibrium.

Suggested Citation

  • David Carfì & Alessia Donato, 2018. "Cournot-Bayesian General Equilibrium: A Radon Measure Approach," Mathematics, MDPI, vol. 7(1), pages 1-19, December.
    • Handle: RePEc:gam:jmathe:v:7:y:2018:i:1:p:10-:d:192633
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    References listed on IDEAS

    as
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    2. Vives, Xavier, 1984. "Duopoly information equilibrium: Cournot and bertrand," Journal of Economic Theory, Elsevier, vol. 34(1), pages 71-94, October.
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    6. Carfì, David & Perrone, Emanuele, 2012. "Game complete analysis of symmetric Cournot duopoly," MPRA Paper 35930, University Library of Munich, Germany.
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