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Welfare Comparison of Leader‐Follower Models in a Mixed Duopoly

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Listed:
  • Aiyuan Tao
  • Yingjun Zhu
  • Xiangqing Zou

Abstract

In the standard leader‐follower duopoly models with otherwise symmetric firms, the market outcome and total welfare are the same whichever firm is the leader. This paper studies and compares total welfare in a sequential‐move mixed duopoly when either the public firm or the private firm acts as the leader. It is found that the fact that which firm is the leader affects total welfare and that whether firms compete in quantity or price also affects the optimal choice of market leader.

Suggested Citation

  • Aiyuan Tao & Yingjun Zhu & Xiangqing Zou, 2013. "Welfare Comparison of Leader‐Follower Models in a Mixed Duopoly," Journal of Applied Mathematics, John Wiley & Sons, vol. 2013(1).
    • Handle: RePEc:wly:jnljam:v:2013:y:2013:i:1:n:320712
    DOI: 10.1155/2013/320712
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    References listed on IDEAS

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