Economic Theory

, Volume 24, Issue 2, pp 307–324

Coalition-proof Bertrand equilibria

Article

DOI: 10.1007/s00199-003-0420-1

Cite this article as:
Chowdhury, P.R. & Sengupta, K. Economic Theory (2004) 24: 307. doi:10.1007/s00199-003-0420-1

Summary.

This paper examines the coalition-proof Nash equilibria of a Bertrand model of price competition where firms supply all demand. When firms are asymmetric we prove existence and provide a sufficient condition for uniqueness. For symmetric firms, we show that an equilibrium is necessarily unique. We also examine whether this unique equilibrium outcome is implementable through a sequential move game where the firms take turns at announcing prices. Finally we examine the limiting property of such equilibria as the number of firms go to infinity.

Keywords and Phrases:

Bertrand oligopoly Coalition-proof Nash equilibrium Implementation Folk theorem 

Copyright information

© Springer-Verlag Berlin/Heidelberg 2004

Authors and Affiliations

  1. 1.Planning UnitIndian Statistical InstituteNew DelhiIndia
  2. 2.School of Political Science and EconomicsUniversity of SydneySydneyAustralia

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