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914. A COOPETITIVE OLIGOPOLY WITH QUANTITY GOALS

Invited abstract in session TA-36: Game Theory, Solutions and Structures V, stream Game Theory, Solutions and Structures.

Tuesday, 8:30-10:00
Room: 32 (building: 306)

Authors (first author is the speaker)

1. Maria de los Angeles Caraballo
University of Seville
2. Asunción Zapata
University of Seville
3. Luisa Monroy
Economia Aplicada III, Universidad de Sevilla
4. Amparo Mármol
Economia Aplicada III and IMUS, Universidad de Sevilla

Abstract

This paper considers an extended setting of a Cournot oligopoly in which firms face a cost when deviating from a fixed quantity that is exogenously given. To analyze these situations, we assume that firms show a coopetitive behavior. The literature usually describes coopetition as the act of cooperation between competing firms by forming a strategic alliance designed to achieve mutual benefits and competitive advantages. Based on this concept, we consider that a firm has a coopetitive behavior when it cares both about its own utility (competition) and also, at least, about the utility of one of the others (cooperation). Moreover, depending on the attitude that a coopetitive firm exhibits with respect to the utilities of the others, different types of firm can be distinguished. Within this framework, the aim of this paper is to analyze the effects of the degree of coopetition on the quantity offered by the firms at equilibrium. Interestingly, we show that in some situations, the firms with a higher degree of coopetition drive the less coopetitive firms out of the market. Furthermore, we obtain the path of equilibrium quantities for a set of values for the degree of coopetition.

Keywords

Status: accepted


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