Correlated equilibria in homogenous good Bertrand competition

Ole Jann and Christoph Schottmüller
Additional contact information
Christoph Schottmüller: Department of Economics, Copenhagen University

No 14-17, Discussion Papers from University of Copenhagen. Department of Economics

Abstract: We show that there is a unique correlated equilibrium, identical to the unique Nash equilibrium, in the classic Bertrand oligopoly model with homogenous goods. This provides a theoretical underpinning for the so-called "Bertrand paradox" and also generalizes earlier results on mixed-strategy Nash equilibria. Our proof generalizes to asymmetric marginal costs and arbitrarily many players.

Keywords: Bertrand paradox; correlated equilibrium; price competition (search for similar items in EconPapers)
JEL-codes: C72 D43 L13 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2014-06-30
New Economics Papers: this item is included in nep-com, nep-ger, nep-gth, nep-hpe and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.econ.ku.dk/english/research/publications/wp/dp_2014/1417.pdf (application/pdf)

Related works:
Journal Article: Correlated equilibria in homogeneous good Bertrand competition (2015)
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:kud:kuiedp:1417

Access Statistics for this paper

More papers in Discussion Papers from University of Copenhagen. Department of Economics Oester Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark. Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Hoffmann ().