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Inventories and Endogenous Stackelberg Leadership in Two-period Cournot Oligopoly

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  • Mitraille, Sébastien
  • Moreaux, Michel

Abstract

Two-period Cournot competition between n identical firms producing at constant marginal cost and able to store before selling has pure strategy Nash- perfect equilibria, in which some firms store to exert endogenously a leader- ship over rivals. The number of firms storing balances market share gains, obtained by accumulating early the output, with losses in margin resulting from increased competition and higher operation costs. This number and the industry inventories are non monotonic in n. Concentration (HHI) and competition increase due to the strategic use of inventories.
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  • Mitraille, Sébastien & Moreaux, Michel, 2011. "Inventories and Endogenous Stackelberg Leadership in Two-period Cournot Oligopoly," LERNA Working Papers 11.15.349, LERNA, University of Toulouse, revised Feb 2012.
  • Handle: RePEc:ler:wpaper:24806
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    Cited by:

    1. Severin Lenhard, 2021. "Imperfect Competition with Costly Disposal," Diskussionsschriften dp2105, Universitaet Bern, Departement Volkswirtschaft.
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    3. Mitraille, Sébastien & Thille, Henry, 2014. "Speculative storage in imperfectly competitive markets," International Journal of Industrial Organization, Elsevier, vol. 35(C), pages 44-59.
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    More about this item

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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