Abstract

References (21)

Beta

Citations (1)

Beta

Add to Cart | Share | Email | Add to Briefcase | Buy Hard Copy

Non-Negative Quantity Constraints and the Duration of Punishment

Luca Lambertini
University of Bologna - Department of Economics

Dan Sasaki
University of Exeter Business School

Japanese Economic Review, Vol. 53, No. 1, pp. 77-93, March 2002

Abstract:
In an oligopoly supergame, firms face an obvious technological constraint: the positivity of their production quantities. Applicability of single-period optimal punishment hinges critically upon the degree of supermodularity in the stage game, as well as upon the positivity constraints on prices and/or quantities. If both prices and quantities are constrained to be positive, then the relevant multi-period punishment prescribes security-level payoffs (where individual rationality binds) when and only when the game is perfectly supermodular, i.e. is either a Bertrand supergame with perfect substitute products or a Cournot supergame with perfect complement products.

JEL Classifications: D43, L13, C72

Accepted Paper Series

Date posted: November 14, 2002 ; Last revised: February 28, 2004

Suggested Citation

Lambertini, Luca and Sasaki, Dan, Non-Negative Quantity Constraints and the Duration of Punishment. Japanese Economic Review, Vol. 53, No. 1, pp. 77-93, March 2002. Available at SSRN: http://ssrn.com/abstract=309136

Export to: Export Citation What's this?

Contact Information

Luca Lambertini (Contact Author) University of Bologna - Department of Economics ( email ) Strada Maggiore 45 40125 Bologna 40125 Italy +39 051 2092600 (Phone) +39 051 2092664 (Fax)
Dan Sasaki University of Exeter Business School ( email ) Department of Economics Exeter, Devon EX4 4PU United Kingdom (44) 1392 263242 (Fax) HOME PAGE: http://www.ex.ac.uk/~dsasaki