Bertrand Competition with Non-rigid Capacity Constraints

Prabal Roy Chowdhury ()

MPRA Paper from University Library of Munich, Germany

Abstract: We examine a model of Bertrand competition with non-rigid capacity constraints, so that by incurring an additional cost, firms can produce beyond capacity. We find that there is an interval of prices such that a price can be sustained as a pure strategy Nash equilibrium if and only if it lies in this interval. We then examine the properties of this set as (a) the number of firms becomes large and (b) the capacity cost increases.

JEL-codes: D5 L2 (search for similar items in EconPapers)
Date: 2008-06
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Bertrand competition with non-rigid capacity constraints (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:9172

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