(五)寡头垄断(博弈论-上财英文课程).pdf

Oligopoly References *Ch 3.1-2, Osborne. Ch 1.2.A-B, Gibbons. Oligopoly Small number of producers. Prominent example of strategic interaction. Questions Understand firm behaviors. Collusion and intervention. Modeling Players and payoffs: Modeling Players and payoffs: Actions: Modeling Players and payoffs: Actions: price, quantity, ad., innovation Modeling Players and payoffs: Actions: price, quantity, ad., innovation Timing: One-shot v.s. repeated plays. Simultaneous or sequential moves Modeling Players and payoffs: Actions: price, quantity, ad., innovation Timing: One-shot v.s. repeated plays. Simultaneous or sequential moves Information: Are costs known? Cournot competition (1) Simultaneous production decisions. (2) Market clear: supply = demand. Bertrand competition (1) Simultaneously name prices. (2) Demand allocation. (3) Production. Cournot’ fits better if price is easily changed. Solving a Cournot duopoly Use iterated elimination of dominated strategies. Nash equilibrium via best response function. Cournot duopoly Inverse demand: P q q a q q i j i j Constant marginal cost: c Players: Actions: Payoffs: B q ? 1 2 Monopoly profit maxq q q q q q 1 2 1 1 2 2 1 2 Alternatively, compute B 10. Higher price and lower supply. Banned by most countries. Possibility of collusion Incentive to cheat. Prisoners’ dilemma. Bertrand duopoly of differenti