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Cartelizing Groups In Dynamic Linear Oligopoly With Antitrust Threshold

Author

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  • AKIO MATSUMOTO

    (Department of Economics, Chuo University, 742-1, Higashi-Nakano, Hachioji, Tokyo, 192-0393, Japan)

  • UGO MERLONE

    (Department of Statistics and Applied Mathematics, University of Torino, Piazza Arbarello 8, Torino I-10122, Italy)

  • FERENC SZIDAROVSZKY

    (Systems and Industrial Engineering Department, University of Arizona, Tucson, AZ 85721-0020, USA)

Abstract

The effects of partially cooperating firms are examined in N-firm oligopolies. The Herfindahl-Hirschmann Index is assumed to detect the violation of the antitrust regulation by the firms, and based on this assumption a piece-wise differentiable dynamic system can be developed. The firms stop cooperating if this index becomes larger than a certain threshold and they restart or continue cooperating otherwise. The equilibria of the dynamic system are first determined. Local and global asymptotic stability of the equilibria are then investigated showing the complexity of the dynamic behavior of the system.

Suggested Citation

  • Akio Matsumoto & Ugo Merlone & Ferenc Szidarovszky, 2008. "Cartelizing Groups In Dynamic Linear Oligopoly With Antitrust Threshold," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 10(04), pages 399-419.
    • Handle: RePEc:wsi:igtrxx:v:10:y:2008:i:04:n:s0219198908002011
    DOI: 10.1142/S0219198908002011
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    References listed on IDEAS

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    1. Matsumoto, Akio & Merlone, Ugo & Szidarovszky, Ferenc, 2010. "Dynamic oligopoly with partial cooperation and antitrust threshold," Journal of Economic Behavior & Organization, Elsevier, vol. 73(2), pages 259-272, February.
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    Citations

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    Cited by:

    1. Yang Gao & Yu Wang & Chien-Chi Chu & Sang-Bing Tsai & Xiaomin Du & Quan Chen, 2018. "Nonlinear Effect of Financial Efficiency and Financial Competition on Heterogeneous Firm R&D: A Study on the Combined Perspective of Financial Quantity Expansion and Quality Development," Sustainability, MDPI, vol. 10(5), pages 1-15, May.
    2. Akio Matsumoto & Ugo Merlone & Ferenc Szidarovszky, 2017. "Extended oligopolies with contingent workforce," Journal of Evolutionary Economics, Springer, vol. 27(5), pages 989-1005, November.
    3. Akio Matsumoto & Ugo Merlone & Ferenc Szidarovszky, 2010. "Cartelising Groups In Dynamic Hyperbolic Oligopoly With Antitrust Threshold," Australian Economic Papers, Wiley Blackwell, vol. 49(4), pages 289-300, December.
    4. Merlone, Ugo & Szidarovszky, Ferenc, 2015. "Dynamic oligopolies with contingent workforce and investment costs," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 108(C), pages 144-154.
    5. Merlone, Ugo & Szidarovszky, Ferenc, 2022. "Cournot oligopoly when the competitors operate under capital constraints," Chaos, Solitons & Fractals, Elsevier, vol. 160(C).

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    2. Merlone, Ugo & Szidarovszky, Ferenc, 2022. "Cournot oligopoly when the competitors operate under capital constraints," Chaos, Solitons & Fractals, Elsevier, vol. 160(C).
    3. Merlone, Ugo & Szidarovszky, Ferenc, 2015. "Dynamic oligopolies with contingent workforce and investment costs," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 108(C), pages 144-154.

    More about this item

    Keywords

    Oligopolies; partial cooperation; shareholding interlocks; antitrust regulation; C71;
    All these keywords.

    JEL classification:

    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • C0 - Mathematical and Quantitative Methods - - General
    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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