Cournot oligopoly: a discrete time sticky-prices paradox

Pierre Bernhard () and Marc Deschamps
Additional contact information
Pierre Bernhard: MACBES Team, INRIA, Université de Côte d'Azur, France

No 2024-01, Working Papers from CRESE

Abstract: This article studies the issue of sticky prices in the context of a dynamic Cournot oligopoly model in discrete time with n asymmetric firms, and with costs and demand linear. We recover the somewhat surprising fact of the related continuous time literature that the asymptotic price is lower than the price of the repeated game. But contrary to the continuous time case, in discrete time we find 1/ that the limit at vanishing viscosity coincides with the non-sticky case, and, more surprisingly 2/ that the equilibrium price trajectory oscillates around the asymptotic price.

Keywords: Sticky price; Cournot oligopoly; Dynamic Game; Discrete time (search for similar items in EconPapers)
JEL-codes: C61 C72 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2024-01
New Economics Papers: this item is included in nep-com, nep-gth and nep-ind
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://crese.univ-fcomte.fr/uploads/wp/WP-2024-01.pdf First version, 2024 (application/pdf)

Related works:
Working Paper: Cournot oligopoly: a discrete time sticky-prices paradox (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:crb:wpaper:2024-01

Access Statistics for this paper

More papers in Working Papers from CRESE Contact information at EDIRC.
Bibliographic data for series maintained by Lauent Kondratuk ().