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Combining the endogenous choice of timing and competition version in a mixed duopoly

Hong-Ren Din () and Chia-Hung Sun ()
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Hong-Ren Din: TransWorld University
Chia-Hung Sun: Soochow University

Journal of Economics, 2016, vol. 118, issue 2, 141-166

Abstract: Abstract This paper extends Sun (Econ Lett 120:364–368, 2013) conceptcombining the endogenous choice of timing and competition version from a pure duopoly model to a mixed duopoly model. We find that choosing a price contract and playing in the first period make up a dominant strategy for the private firm. The public firm’s best response to the private firm’s dominant strategy is also to choose a price contract and play in the first period. As a result, simultaneous price competition is the unique equilibrium outcome, no matter whether the goods are substitutes or complements. Combining the findings in Sun (Econ Lett 120:364–368, 2013), we present that simultaneous price competition is the unique result with complement products, irrespective of whether for a pure duopoly model or for a mixed duopoly model.

Keywords: Cournot competition; Bertrand competition; Endogenous competition version; Endogenous timing; Mixed duopoly (search for similar items in EconPapers)
JEL-codes: L13 D43 D21 (search for similar items in EconPapers)
Date: 2016
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