Showing papers on "Stackelberg competition published in 1993"
TL;DR: In this article, the authors give the firm with superior information the option of delaying its quantity decision until the decision period of the less informed firm (so that decisions are made simultaneously).
137 citations
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TL;DR: In this paper, the authors adopt the framework of this literature and build on it by analyzing the size and uniqueness of the stable cartel when the fringe is Coumot, and the endogeneity of Courot versus Bertrand behavior within the fringe, given a stable cartel; possible endogeneity, Stackelberg sequence of play between the cartel and the fringe; and effects of excludability from the cartel Welfare effects are also briefly analyzed.
Abstract: The notion of an industry structure characterized by a small group of dominant firms plus a competitive fringe has a long tradition More recent work explores conditions under which such a pattern constitutes an equilibrium, assuming collusive behavior among one group of firms and price-taking behavior within the fringe [2; 3; 4; 5; 6; 14; 17] The alternative case of a Courot fringe is analyzed briefly in Spulber [22, 471-73] and more extensively in Martin [14] Here we adopt the framework of this literature and build on it by analyzing the size and uniqueness of the stable cartel when the fringe is Coumot; endogeneity of Courot versus Bertrand behavior within the fringe, given the stable cartel; possible endogeneity of the Stackelberg sequence of play between the cartel and the fringe; and effects of excludability from the cartel Welfare effects are also briefly analyzed Alternatively, cooperation within a cartel is equivalent to the outcome of horizontal mergers in the absence of synergies As such, this paper presents a contrasting result to the analysis of exogenous Cournot mergers in Salant, Switzer, and Reynolds [18], endogenizes the merger decision, and demonstrates how a theory of mergers can be predicated on a Cournot fringe
80 citations
TL;DR: The authors analyzes Stackelberg price leadership in a duopoly in which firms are capacity constrained and products are imperfect substitutes and provides a game theoretic model of dominant firm price leadership.
Abstract: This paper analyzes Stackelberg price leadership in a duopoly in which firms are capacity constrained and products are imperfect substitutes. Assuming symmetric substitutes, linear demand, and efficient rationing, we characterize the equilibria with an exogenously specified leader. Using the equilibrium profits derived from these games, we argue that over certain ranges of asymmetric capacities an endogenous price leader will emerge. When endogenous leadership does arise, it is the large capacity firm which is the leader. We thus provide a game theoretic model of dominant firm price leadership.
70 citations
TL;DR: In this paper, first-order necessary optimality conditions are derived for a class of two-level Stackelberg problems in which the followers' lower-level problems are convex programs with unique solutions.
Abstract: First-order necessary optimality conditions are derived for a class of two-level Stackelberg problems in which the followers' lower-level problems are convex programs with unique solutions To this purpose, generalized Jacobians of the marginal maps corresponding to followers' problems are estimated As illustrative examples, two discretized optimum design problems with elliptic variational inequalities are investigated The theoretical results may be used also for the numerical solution of the Stackelberg problems considered by nondifferentiable optimization methods
68 citations
TL;DR: In this paper, a formal analysis of rent-seeking games in which the players do not move simultaneously is presented, where the players are risk neutral and may value the prize differently.
Abstract: In this paper I present a formal analysis of rent-seeking games in which the players do not move simultaneously. I consider rent-seeking situations where the players are risk neutral and may value the prize differently. The subgame perfect equilibrium outcome in this Stackelberg game provides several surprising and interesting results. I extend the problem to deal with cases of in- complete information concerning the value a player has for the politically contestable rent.
60 citations
TL;DR: In this paper, the optimal location choice in a standard game of horizontal differentiation in which firms are free to locate outside the city boundaries is analyzed, and it turns out that the unique Nash equilibium exhibits a finite distance between the sellers, so that the maximum differentiation principle is not confirmed.
Abstract: In this paper, we try to analyse the optimal location choice in a standard game of horizontal differentiation in which firms are free to locate outside the city boundaries. It turns out that the unique Nash equilibium exhibits a finite distance between the sellers, so that the maximum differentiation principle is not confirmed. Moreover, the two symmetric Stackelberg equilibria exhibit the same degree of differentiation observed when the game is non cooperatively played within the city, except that the leader locates at the center.
45 citations
TL;DR: The authors analyzes a game of strategic trade policy between governments who may choose among quantity controls, subsidies, and nonintervention as policy instruments, and derives conditions under which non-intervention is strictly preferred to the alternative instruments.
38 citations
TL;DR: In this article, the authors analyze whether a game is played simultaneously or sequentially in 2 × 2 games using an extended game, where players can choose in which of two periods to move.
Abstract: Players often have flexibility in when they move and thus whether a game is played simultaneously or sequentially may be endogenously determined. For 2 × 2 games, we analyze this using an extended game. In a stage prior to actual play, players choose in which of two periods to move. A player moving at the first opportunity knows when his opponent will move. A player moving at the second turn learns the first mover's action. If both select the same turn, they play a simultaneous move subgame.
24 citations
TL;DR: In this paper, the authors consider a two-level optimization problem corresponding to a Stackelberg game in which the response function of the follower is multivalued and some convexity assumption on the data is missing.
Abstract: We consider a two-level optimization problem corresponding to a Stackelberg game in which the response function of the follower is multivalued and some convexity assumption on the data is missing. Different notions of ɛ-mixed strategies are introduced and sufficient conditions on the data for existence and convergence of the corresponding average values, as ɛ converges to 0, are given together with several examples.
19 citations
TL;DR: In this article, the authors characterize and compare the Stackelberg equilibria and the Bertrand equilibrium in a spatial duopoly, and show that when the cost of informing the consumers is small, duopolists always choose to inform all consumers in Bertrand, but may choose not to inform everyone when the duopolistic competition is intense enough (thereby generating overlapping markets).
15 citations
TL;DR: In this article, the authors present an alternative approach for analyzing international competition and alliances as rent-seeking contests that are able to capture the impure public good nature of defense spending, and a three-country model is investigated, and alliance behavior is explored in the context of this rentseeking model.
Abstract: This paper presents an alternative approach for analyzing international competition and alliances as rent‐seeking contests that are able to capture the impure public good nature of defense spending. Two‐country Cournot and Stackelberg games are considered and comparative static results derived. A three‐country model is investigated, and alliance behavior is explored in the context of this rent‐seeking model. The conjecture that an alliance may become less effective if the allies’ interests become more closely aligned is verified. Finally, the model is generalized, and a Nash‐Cournot equilibrium is computed.
TL;DR: In this article, it was shown that the behavior of a workers' enterprise is tamed by the workerpartnership market so as to be identical with that of a twin entrepreneurial firm.
Abstract: Extending earlier equivalence results for perfect competition and for (imperfect) quantity competition, here it is shown that in price competition, too, the behavior of a workers‘ enterprise (defined by the coincidence of its workers with its partners) is tamed by the worker-partnership market so as to be identical with that of a twin entrepreneurial firm. Thus, not only is Bertrand–Nash equilibrium unaltered when an entrepreneurial firm is replaced by its workers’ enterprise twin, but such a replacement also leaves Bertrand-von Stackelberg equilibrium intact whether we switch the leader or a follower from one form of ownership/management to the other.
TL;DR: This paper derives under which conditions the competition between the females results in an increase in the first female's optimal clutch size, compared to the solitary optimum, and derives underWhich conditions the firstFemale should lay more eggs than the second female.
TL;DR: In this paper, the authors presented a recursive reduced order algorithm in the context of linear closed-loop Stackelberg strategies for singularly perturbed systems and showed that the proposed recursive algorithm improves the accuracy of the sought solution.
Abstract: The recursive reduced order algorithm in the context of linear closed-loop Stackelberg strategies for singularly perturbed systems is presented. Motivated by previous results for the weakly coupled linear quadratic Nash games, it is shown that a similar algorithm can be produced for singularly perturbed linear quadratic Stackelberg games and the fixed point method is very effective in this case also. It is shown that the proposed recursive algorithm improves the accuracy of the sought solution, that is, the singularly perturbed recursive algorithm converges with the rate of convergence of accuracy O(e). Since all results on linear closed-loop Stackelberg game problem for the singularly perturbed systems can be obtained as far with an accuracy O( e) only, that represents a significant improvement. In order to demonstrate the effectiveness of the proposed algorithm and the failure of the O( e) theory, a numerical example is shown.
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TL;DR: In this article, the authors used a model consisting of a linear estimate of a demand curve, a linear quadratic cost curve and a logistic diffusion curve, and four types of imperfectly competitive behaviour, including monopolistic intertemporal profit maximization, dynamic Bertrand oligopoly, and a duopolistic differential game with endogenous market potential.
Abstract: This paper uses a model (consisting of a linear estimate of a demand curve, a linear quadratic cost curve and a logistic diffusion curve) and four types of imperfectly competitive behaviour — monopolistic intertemporal profit maximization, a dynamic Bertrand oligopoly, and a duopolistic differential game with endogenous market potential, which leads to a Stackelberg leadership situation or a phase of pure monopoly. The implied impact from the change in market structure on the S-shaped diffusion curve is derived and drawn.
TL;DR: In this paper, necessary conditions for a optimal Stackelberg strategy with output feedback form are given, in the special case that all decision maker have complete information, the necessary conditions are identical to previous results.
TL;DR: In this article, the endogenous choice between two alternative kinds of product differentiation is addressed in a duopoly model where firms are free to locate along the real axis, while consumers are distributed along a linear city of finite length.
Abstract: The endogenous choice between two alternative kinds of product differentiation is addressed in a duopoly model where firms are free to locate along the real axis, while consumers are distributed along a linear city of finite length. It turns out that the nature of differentiation may be heavily affected by the sequence of decisions. If firms simultaneously choose first locations and then prices, product differentiation at equilibrium is horizontal. If instead one firm acts as a Stackelberg leader in both stages, product differentiation at equilibrium is vertical.
TL;DR: In this article, a modified Stacke1berg model is proposed, based on the former Stackclberg game model (see von Stackelberg (1952)). This modified model from a kind of limited cooperative economic phenomena is complementary for the perfect competitive model.
TL;DR: In this article, the inventory management problem is discussed by means of the Stackelberg game theory, and a control scheme to control the consumption of raw mterial directly and control the supply of raw material indirectly, then, is presented.
Journal Article•
TL;DR: It is well known that Cournot's model of oligopoly is an application of the Nash equilibrium concept as discussed by the authors, but it is not generally known that John Nash did not know of Cournots work when he wrote his famous papers on the definition and existence of (Nash) equilibrium for finite games.
Abstract: It is well known that Cournot's model of oligopoly is an application of the . Nash equilibrium concept. What is not generally known is that John Nash did not know of Cournot's work when he wrote his famous papers on the definition and existence of (Nash) equilibrium for finite games (Nash, 1950, 1951). Iwas told this by Nash himselfin a conversation in 1985 in Princeton. It was only sometime later that Martin Shubik told him about Cournot's Recherches, and they wrote a piece connecting the two (Mayberry, Nash and Shub,ik, 1953). I always found it fascinanting that such a fundamental text as Cournot (1838) had so little impact in economics, even after being the point of departure of Bertrand (1883), Edgeworth (1987) and Fisher (1989), after being translated into English in an edition commented by Irving Fisher (Cournot, 1927), after having strongly influenced Chamberlin (1936), and after being the object of two reviews in Econometrica (Fisher, 1938; and Nichols, 1938). It is clear that Nash's advisor, John von Neumann, did not know Cournot's Recherches since the lalter is not cited in none of the three editions of The theory of games and economic behavior (von Neumann and Morgenstcrn, 1944).