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Olga Dusouchet1
  • 1 National Research University Higher School of Economics, 20 Myasnitskaya Str., Moscow, 101000, Russian Federation

Static Cournot – Nash Equilibria and Strategic Reflective Games of Oligopoly: a Case Both Linear Functions of Demand and Costs

2006. Vol. 10. No. 1. P. 3–32 [issue contents]
A problem of static oligopoly equilibria is studied with using non-cooperative static n-person game and strategic reflective games in a class of linear functions of demand and cost. There are introduced a concept of firm’s competitiveness in Cournot– Nash equilibrium, a notion of conjectural variations as a first derivatives of Stackelberg curves, and a notion of sequentially-grouped order game. Bresnahan's proposition (1981) about inconsistency of Cournot’s conjectures are analyzed and refuted. The propositions in the papers by Bergstrom and Varian (1985), and Novshek (1985) are corrected with using of the concept of firm’s competitiveness. The static task has been solved and а convergence of strategic reflective game processes to Cournot – Nash equilibrium has been analyzed. A process of a sequential game converges, independently of number of uncompetitive firms. A process of a simulta-neous game will diverge if number of firms is more than 2; otherwise a process will converge to Cournot – Nash equilibrium. A process of sequentially-grouped order game depends on initial choice of firms and a distribution of competitive firms among the groups; the process may be cyclical or converges; except when no more then two firms are in the groups and the process will converge.
Citation: Dyushushe O. (2006) Statichnoe ravnovesie Kurno – Nesha i refleksivnye igry oligopolii: sluchay lineynykh funktsiy sprosa i izderzhek [Static Cournot – Nash Equilibria and Strategic Reflective Games of Oligopoly: a Case Both Linear Functions of Demand and Costs]. HSE Economic Journal , vol. 10, no 1, pp. 3-32 (in Russian)
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