On the Effects of an Industry-wide Cost Change in a Stackelberg Duopoly / Die Effekte einer industrieweiten Kostenveränderung im Stackelberg Duopol

Toolsema Linda A. () and Lambert Schoonbeek
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Toolsema Linda A.: Department of Economics, University of Groningen, P.O. Box 800, NL-9700 AV Groningen, The Netherlands

Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), 2000, vol. 220, issue 5, 592-598

Abstract: Consider a homogeneous Stackelberg leader-follower duopoly with quantity competition, in which both firms face the same industry-wide marginal costs. This paper investigates the comparative static effects of a change in these marginal costs. We show that an increase of the costs will lead to a decrease of the total market output. However, it turns out that the output of the leader firm might increase. We present conditions under which the latter counterintuitive effect occurs.

Keywords: Stackelberg duopoly; cost change; Stackelberg Duopol; Kostenveränderung (search for similar items in EconPapers)
Date: 2000
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Persistent link: https://EconPapers.repec.org/RePEc:jns:jbstat:v:220:y:2000:i:5:p:592-598

DOI: 10.1515/jbnst-2000-0507

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