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Coalition-proof Bertrand equilibria

Author

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  • Prabal Chowdhury

    ()

  • Kunal Sengupta

    ()

Abstract

This paper examines the coalition-proof Nash equilibria of a Bertrand model of price competition where firms supply all demand. When firms are asymmetric we prove existence and provide a sufficient condition for uniqueness. For symmetric firms, we show that an equilibrium is necessarily unique. We also examine whether this unique equilibrium outcome is implementable through a sequential move game where the firms take turns at announcing prices. Finally we examine the limiting property of such equilibria as the number of firms go to infinity. Copyright Springer-Verlag Berlin/Heidelberg 2004

Suggested Citation

  • Prabal Chowdhury & Kunal Sengupta, 2004. "Coalition-proof Bertrand equilibria," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 24(2), pages 307-324, August.
  • Handle: RePEc:spr:joecth:v:24:y:2004:i:2:p:307-324
    DOI: 10.1007/s00199-003-0420-1
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    Citations

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    Cited by:

    1. Roy Chowdhury, Prabal, 2009. "Bertrand competition with non-rigid capacity constraints," Economics Letters, Elsevier, vol. 103(1), pages 55-58, April.
    2. repec:spr:etbull:v:5:y:2017:i:2:d:10.1007_s40505-017-0114-7 is not listed on IDEAS
    3. Juan Delgado, 2006. "Coalition-proof supply function equilibria under capacity constraints," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 29(1), pages 219-229, September.
    4. Andersson, Ola & Argenton, Cédric & Weibull, Jörgen W., 2014. "Robustness to strategic uncertainty," Games and Economic Behavior, Elsevier, vol. 85(C), pages 272-288.
    5. Andersson, Ola & Argenton, Cédric & Weibull, Jörgen, 2010. "Robustness to strategic uncertainty in price competition," SSE/EFI Working Paper Series in Economics and Finance 0726, Stockholm School of Economics, revised 08 Apr 2010.
    6. Roy Chowdhury, Prabal, 2009. "Free Entry Bertrand Competition," MPRA Paper 17837, University Library of Munich, Germany.
    7. repec:spr:etbull:v:1:y:2013:i:1:d:10.1007_s40505-013-0011-7 is not listed on IDEAS
    8. Roy Chowdhury, Prabal, 2009. "Mixed Duopoly with Price Competition," MPRA Paper 9220, University Library of Munich, Germany.
    9. Marie-Laure Cabon-Dhersin & Nicolas Drouhin, 2010. "The end of the Bertrand Paradox ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00542486, HAL.
    10. Chia-Hung Sun & Fu-Chuan Lai, 2013. "Hotelling was right with decreasing returns to scale and a coalition-proof refinement," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 50(3), pages 953-971, June.
    11. repec:kap:jeczfn:v:121:y:2017:i:2:d:10.1007_s00712-017-0527-7 is not listed on IDEAS
    12. Arghya Ghosh & Manipushpak Mitra, 2014. "Reversal of Bertrand-Cournot Rankings in the Presence of Welfare Concerns," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 170(3), pages 496-519, September.

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