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Industry profits and market size under bilateral oligopoly

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Abstract

We show that, contrary to the key result of the standard Cournot-Nash oligopoly model, industry profits can increase with the number of firms if input prices are not exogenous but are determined by bargaining in bilateral oligopoly. The relationship between industry profits and market size is shown to depend on the relative bargaining power of the upstream and downstream agents.

Suggested Citation

  • R. Naylor, 2001. "Industry profits and market size under bilateral oligopoly," Working Paper CRENoS 200108, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    • Handle: RePEc:cns:cnscwp:200108
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    Cited by:

    1. Naylor, Robin, 2002. "The Effects Of Entry In Bilateral Oligopoly," The Warwick Economics Research Paper Series (TWERPS) 638, University of Warwick, Department of Economics.
    2. R. Naylor, 2001. "Firm profits and the number of firms under unionised oligopoly," Working Paper CRENoS 200109, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.

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