Contributions to oligopoly theory

Antonios Pavlopoulos

MPRA Paper from University Library of Munich, Germany

Abstract: In the context of the Cournot model a demand function parameter is treated as the dual of the firm’s profit. Following the demand theory’s duality approach it’s possible to introduce the concept of the compensated reaction function (or compensated best-response function), as well as the concepts of net strategic complementarity/substitutability. The firm’s reaction function is analysed into a type-1 and a type-2 effect, which are the counterparts, respectively, of the demand theory substitution and income effects. Further, new results are obtained regarding Cournot equilibrium in the case of profit functions which are homogeneous in their arguments.

Keywords: Cournot model; compensated reaction function; net strategic complementarity/substitutability (search for similar items in EconPapers)
JEL-codes: D43 L13 (search for similar items in EconPapers)
Date: 2012-02-25
New Economics Papers: this item is included in nep-com, nep-hpe and nep-ind
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