A Note on the Environmental Impact of Bertrand and Cournot Duopolies

Luca Lambertini () and Alessandro Tampieri

Economia politica, 2014, issue 1, 81-88

Abstract: We compare a Bertrand with a Cournot duopoly in a setting where production is polluting and exploits natural resources, and firms bear convex production costs. We adopt Dastidar's (1995) approach, yielding a continuum of Bertrand-Nash equilibria ranging above marginal cost pricing also, to show that softening price competition may lead to a lower output production in a Bertrand rather than a Cournot industry. The market structure bringing about the lowest output determines the highest social welfare, given the fact that the negative environmental effects of production more than offset the gain in consumer surplus.

Keywords: JEL Classification: L13; Q51. (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.rivisteweb.it/download/article/10.1428/76492 (application/pdf)
https://www.rivisteweb.it/doi/10.1428/76492 (text/html)
Access to full text is restricted to subscribers

Related works:
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:mul:jb33yl:doi:10.1428/76492:y:2014:i:1:p:81-88

Access Statistics for this article

Economia politica is currently edited by Alberto Quadrio Curzio, Giorgio Lunghini, Pier Carlo Nicola

More articles in Economia politica from Società editrice il Mulino
Bibliographic data for series maintained by ().