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