Research ArticleOpen AccessGoogle Scholar indexed
Stackelberg-Cournot and Cournot Equilibria in a Mixed Markets Exchange Economy
LEG, University of Burgundy, Burgundy, France
- 1 LEG, University of Burgundy, Burgundy, France
Theoretical Economics Letters·Volume 02 (2012)·Pages 300–306·Published 2 August 2012·DOI10.4236/tel.2012.23056
Copy link · social · email
Abstract
In this note, we compare two strategic general equilibrium concepts: the Stackelberg-Cournot equilibrium and the Cournot equilibrium. We thus consider a market exchange economy including atoms and a continuum of traders, who behave strategically. We show that, when the preferences of the small traders are represented by Cobb-Douglas utility functions and the atoms have the same utility functions and endowments, the Stackelberg-Cournot and the Cournot equilibrium equilibria coincide if and only if the followers’ best responses functions have a zero slope at the SCE.
KeywordsStackelberg-Cournot EquilibriumConjectural VariationsPreferences
- J. J. Gabszewicz and J. P. Vial, “Oligopoly ‘à la Cournot’ in General Equilibrium Analysis,” Journal of Economic Theory, Vol. 4, No. 3, 1972, pp. 381-400. doi:10.1016/0022-0531(72)90129-9
- G. Codognato and J. J. Gabszewicz, “Equilibres de Cournot-Walras dans une économie d’échange,” Revue Economique, Vol. 42, No. 6, 1991, pp. 1013-1026. doi:10.2307/3502021
- G. Codognato and J. J. Gabszewicz, “Cournot-Walras Equilibria in Markets with a Continuum of Traders,” Economic Theory, Vol. 3, No. 3, 1993, pp. 453-464. doi:10.1007/BF01209696
- J. J. Gabszewicz and P. Michel, “Oligopoly Equilibria in Exchange Economies,” In: B. C. Eaton and R. G. Harris, Eds., Trade, Technology and Economics. Essays in Honour of R.G. Lipsey, Edward-Elgar, Cheltenham, 1997, pp. 217-240.
- F. Busetto, G. Codognato and S. Ghosal, “Noncooperative Oligopoly in Markets with a Continuum of Traders,” Games and Economic Behavior, Vol. 72, No. 1, 2011, pp. 38-45. doi:10.1016/j.geb.2010.06.009
- F. Busetto, G. Codognato and S. Ghosal, “Cournot-Walras Equilibrium as a Subgame Perfect Equilibrium,” International Journal of Game Theory, Vol. 37, No. 3, 2008, pp. 371-386. doi:10.1007/s00182-008-0123-8
- L. Shapley and M. Shubik, “Trade Using One Commodity as a Means of Payment,” Journal of Political Economy, Vol. 85, No. 5, 1977, pp. 937-967. doi:10.1086/260616
- P. Dubey and M. Shubik, “The Non Cooperative Equilibria of a Closed Trading Economy with Market Supply and Bidding Strategies,” Journal of Economic Theory, Vol. 17, No. 1, 1978, pp. 1-20. doi:10.1016/0022-0531(78)90119-9
- S. Sahi and S. Yao, “The Noncooperative Equilibria of a Trading Economy with Complete Markets and Consistent Prices,” Journal of Mathematical Economics, Vol. 18, No. 4, 1989, pp. 325-346. doi:10.1016/0304-4068(89)90010-4
- R. Amir, S. Sahi, M. Shubik and S. Yao, “A Strategic Market Game with Complete Markets,” Journal of Economic Theory, Vol. 51, No. 1, 1990, pp. 126-143. doi:10.1016/0022-0531(90)90054-N
- G. Codognato, “Cournot-Walras Equilibria in Mixed Markets: A Comparison,” Economic Theory, Vol. 5, No. 2, 1995, pp. 361-370. doi:10.1007/BF01215210
- G. Codognato, “Cournot-Nash Equilibria in Limit Exchange Economies with Complete Markets: A Comparison between Two Models,” Games and Economic Behavior, Vol. 31, No. 1, 2000, pp. 136-146. doi:10.1006/game.1999.0735
- L. A. Julien and F. Tricou, “Oligopoly Equilibria ‘à la Stackelberg’ in Pure Exchange Economies,” Louvain Economic Review, Vol. 76, No. 2, 2010, pp. 239-252.