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Effects Of Symmetry On Globalizing Separated Monopolies To A Nash-Cournot Oligopoly

Author

Listed:
  • HISAO KAMEDA

    (Department of Computer Science, University of Tsukuba, Tsukuba Science city, Ibaraki 305-8573, Japan)

  • TAKASHI UI

    (Department of Economics, Hitotsubashi University, Kunitachi, Tokyo 186-8601, Japan)

Abstract

The effects of uniting separated markets, each monopolized by a producer, into a globalized oligopolistic market, which is regarded as a noncooperative game, or as a Cournot oligopoly game, are investigated. The cases where such globalization degrades the profits of all producers coincidently, are examined. Linear demand and production functions are considered. It is shown that in complete symmetry, the degree of such coincident profit degradation is strongest (the worst-case ratio), where the degree means the most modest ratio of the profit degradation among all producers. The system is in complete symmetry when the values of parameters describing all producers and markets are identical. On the other hand, in producer symmetry, the degree of coincident consumer surplus improvement is highest (the best-case ratio), where the degree means the lowest of the ratios of consumer surplus improvement among all (previously separated) markets. The system is in producer symmetry when the values of parameters describing all producers are identical.

Suggested Citation

  • Hisao Kameda & Takashi Ui, 2012. "Effects Of Symmetry On Globalizing Separated Monopolies To A Nash-Cournot Oligopoly," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 14(02), pages 1-15.
    • Handle: RePEc:wsi:igtrxx:v:14:y:2012:i:02:n:s0219198912500090
    DOI: 10.1142/S0219198912500090
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    Citations

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    Cited by:

    1. Mariel Leal & Arturo García & Sang-Ho Lee, 2020. "Effects of Integration with a Consumer-Friendly Firm in a Cournot Duopoly," Journal of Industry, Competition and Trade, Springer, vol. 20(3), pages 587-604, September.
    2. Leal, Mariel & Garcia, Arturo & Lee, Sang-Ho, 2017. "Effects of globalizing a consumer-friendly firm into an asymmetric mixed duopoly," MPRA Paper 83512, University Library of Munich, Germany.
    3. Kameda, Hisao, 2021. "Magnitude of inefficiency," European Journal of Operational Research, Elsevier, vol. 292(3), pages 1133-1145.

    More about this item

    Keywords

    Oligopoly; monopoly; Braess paradox; prisoners' dilemma; Nash equilibrium; producer profit; consumer surplus; Pareto inefficiency; 91A10; 78M50; 91B38;
    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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