 Can they beat the Cournot equilibrium? Learning with memory and convergence to equilibria in a Cournot oligopolyThomas Vallee and Murat Yildizoglu Post-Print from HAL Abstract: This article analyses the ability of the learning firms in a Cournot oligopoly to discover market solutions more collusive that the Cournot equilibrium (CE). We start from the results of Vallée and Yıldızoğlu (J Econ Behav Organ 72:670–690, 2009 ) and of Alós-Ferrer (Int J Ind Organ 22:193–217, 2004 ), and qualify the role of random experimenting, social learning (imitation), and (updated) memory in helping firms to discover such solutions. Our new computational results show, in contradiction with Alós-Ferrer (2004) , that memory and its continuous update can indeed allow firms to beat the CE, and benefit from significant periods with higher profits. We show that the results of the literature on evolutionary learning in oligopoly can analytically be characterized through the interaction of three forces, and indicate when these forces can yield more collusive outcomes. We confirm these results with complementary computational experiments that clearly show the role of long memory. Copyright Springer Science+Business Media New York 2013 Keywords: Cournot oligopoly; Learning; Evolution; Selection; Evolutionary stability; Nash equilibrium; Collusion (search for similar items in EconPapers) Published in Computational Economics, 2013, 25 p. ⟨10.1007/s10614-012-9349-4⟩ There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00778934 DOI: 10.1007/s10614-012-9349-4 Access Statistics for this paper More papers in Post-Print from HAL |
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