Oligopolistic Equilibrium and Financial Constraints

Yosuke Yasuda (), Luis C. Corchón and Carmen Bevia ()
Authors registered in the RePEc Author Service: Luis C. Corchon

No 547, Working Papers from Barcelona School of Economics

Abstract: In this paper we present a model of oligopoly and financial constraints. We study allocations which are bankruptcy-free (BF) in the sense that no firm can drive another firm to bankruptcy without becoming bankrupt. We show how such allocations can be sustained as an equilibrium of a dynamic game. When there are two firms, all equilibria yield BF allocations. When there are more than two firms, allocations other than BF can be sustained as equilibria but in some cases the set of BF allocations still useful in explaining the shape of equilibrium set.

Keywords: Financial constraints; bankruptcy; Firm Behavior; Dynamic Games (search for similar items in EconPapers)
JEL-codes: D2 D4 L1 L2 (search for similar items in EconPapers)
Date: 2015-09
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Related works:
Journal Article: Oligopolistic equilibrium and financial constraints (2020)
Working Paper: Oligopolistic Equilibrium and Financial Constraints (2015)
Working Paper: Oligopolistic equilibrium and financial constraints (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:547

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