On the Existence of Cournot Equilibrium

William Novshek

The Review of Economic Studies, 1985, vol. 52, issue 1, 85-98

Abstract: This paper examines the existence of n-firm Cournot equilibrium in a market for a single homogeneous commodity. It proves that if each firm's marginal revenue declines as the aggregate output of other firms increases (which is implied by concave inverse demand) then a Cournot equilibrium exists, without assuming that firms have nondecreasing marginal cost or identical technologies. Also, if the marginal revenue condition fails at a "potential optimal output", there is a set of firms such that no Cournot equilibrium exists. The paper also contains an example of nonexistence with two nonidentical firms, each with constant returns to scale production.

Date: 1985
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Working Paper: On the Existence of Cournot Equilibrium (1984)
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Persistent link: https://EconPapers.repec.org/RePEc:oup:restud:v:52:y:1985:i:1:p:85-98.

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