Quantity Precommitment and Bertrand Competition Yield Cournot Outcomes: A Case with Product Differentiation
9 Pages Posted: 16 Mar 2011
Date Written: March 19, 2008
Using a simple model of two-stage duopoly game, this paper shows that Bertrand-like price competition on a differentiated goods market, following a simultaneous endogenous choice of production capacity, yields the Cournot-like outcomes.
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