Cournot Competition on a Network of Markets and Firms

Rahmi Ilkilic

No 50679, Sustainable Development Papers from Fondazione Eni Enrico Mattei (FEEM)

Abstract: Suppose markets and firms are connected in a bi-partite network, where firms can only supply to the markets they are connected to. Firms compete a la Cournot and decide how much to supply to each market they have a link with. We assume that markets have linear demand functions and firms have convex quadratic cost functions. We show there exists a unique equilibrium in any given network of firms and markets. We provide a formula which expresses the quantities at an equilibrium as a function of a network centrality measure.

Keywords: Institutional; and; Behavioral; Economics (search for similar items in EconPapers)
Pages: 23
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:ags:feemdp:50679

DOI: 10.22004/ag.econ.50679

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