 Cooperation in a differentiated duopoly when information is dispersed: A beauty contest game with endogenous concern for coordinationCamille Cornand and Rodolphe Dos Santos Ferreira Mathematical Social Sciences, 2020, vol. 106, issue C, 101-111 Abstract: The paper contribution is twofold. It introduces heterogeneous information in a strategic delegation game of a differentiated oligopoly with price competition and it thus provides a micro-founded illustration of a beauty contest, in which the relative weight put on the competition motive of the payoffs is not exogenous but may be manipulated by the players. The conflict between the competition and the fundamental motives, already present in an oligopolistic setting under perfect information, is exacerbated when information is dispersed. A conflict arises also in this case between the competition and the coordination motives, ending up in the undervalueing of public information. We show how firm owners ease these conflicts by opting for some cooperation, thus moderating the competitive toughness displayed by their managers. By doing so, they also enhance the managers’ concern for coordination and consequently heighten the weight put on public relative to private information. Keywords: Beauty contest; Competition; Cooperation; Coordination; Delegation game; Duopoly with heterogeneous information (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:matsoc:v:106:y:2020:i:c:p:101-111 DOI: 10.1016/j.mathsocsci.2020.02.003 Access Statistics for this article Mathematical Social Sciences is currently edited by J.-F. Laslier More articles in Mathematical Social Sciences from Elsevier |
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