Bertrand Competition with Asymmetric Costs: A Solution in Pure Strategies

Thomas Demuynck; P. Jean-Jacques Herings; Riccardo D. Saulle; Christian Seel

doi:10.26481/umagsb.2018002

Bertrand Competition with Asymmetric Costs: A Solution in Pure Strategies

Thomas Demuynck, P. Jean-Jacques Herings, Riccardo D. Saulle, Christian Seel

Microeconomics & Public Economics

Research output: Working paper / Preprint › Working paper

1125 Downloads (Pure)

Abstract

We consider two versions of a Bertrand duopoly with asymmetric costs and homogeneous goods. They differ in whether predatory pricing is allowed. For each version, we derive the Myopic Stable Set in pure strategies as introduced by Demuynck, Herings, Saulle, and Seel (2017). We contrast our prediction to the prediction of Nash Equilibrium in mixed strategies.

Original language	English
Publisher	Maastricht University, Graduate School of Business and Economics
DOIs	https://doi.org/10.26481/umagsb.2018002
Publication status	Published - 8 Feb 2018

Publication series

Series	GSBE Research Memoranda
Number	002

JEL classifications

c70 - Game Theory and Bargaining Theory: General
c72 - Noncooperative Games
d43 - Market Structure and Pricing: Oligopoly and Other Forms of Market Imperfection

Keywords

Bertrand Competition
Asymmetric Costs
Myopic Stable Set

Access to Document

10.26481/umagsb.2018002

RM18002Final published version, 482 KB

Cite this

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