IDEAS home Printed from https://ideas.repec.org/a/spr/joecth/v19y2002i2p271-282.html
   My bibliography  Save this article

Winner-take-all price competition

Author

Listed:
  • John Morgan

    () (Woodrow Wilson School for Public and International Affairs and Department of Economics,Princeton University, Princeton, NJ 08544, USA)

  • Michael R. Baye

    () (Department of Business Economics and Public Policy, Kelley School of Business,Indiana University, 1309 East Tenth Street, Bloomington, IN 47405-1701, USA%)

Abstract

We analyze an oligopoly model of homogeneous product price competition that allows for discontinuities in demand and/or costs. Conditions under which only zero profit equilibrium outcomes obtain in such settings are provided. We then illustrate through a series of examples that the conditions provided are "tight" in the sense that their relaxation leads to positive profit outcomes.

Suggested Citation

  • John Morgan & Michael R. Baye, 2002. "Winner-take-all price competition," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 19(2), pages 271-282.
  • Handle: RePEc:spr:joecth:v:19:y:2002:i:2:p:271-282
    Note: Received: April 7, 2000; revised version: September 14, 2000
    as

    Download full text from publisher

    File URL: http://link.springer.de/link/service/journals/00199/papers/2019002/20190271.pdf
    Download Restriction: Access to the full text of the articles in this series is restricted

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hoernig, Steffen, 2005. "Bertrand Equilibria and Sharing Rules," CEPR Discussion Papers 4972, C.E.P.R. Discussion Papers.
    2. Ganesh Iyer & Amit Pazgal, 2008. "Procurement bidding with restrictions," Quantitative Marketing and Economics (QME), Springer, vol. 6(2), pages 177-204, June.
    3. Alejandro Saporiti & German Coloma, 2008. "Bertrand's price competition in markets with fixed costs," RCER Working Papers 541, University of Rochester - Center for Economic Research (RCER).
    4. Oriol Carbonell-Nicolau, 2011. "The Existence of Perfect Equilibrium in Discontinuous Games," Games, MDPI, Open Access Journal, vol. 2(3), pages 1-22, July.

    More about this item

    Keywords

    Price competition; Discontinuity; Bertrand; Hotelling.;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:joecth:v:19:y:2002:i:2:p:271-282. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.