Game Theory pp 133-138 | Cite as

Duopoly

  • James W. Friedman
Part of the The New Palgrave book series

Abstract

A duopoly is a market in which two firms sell a product to a large number of consumers. Each consumer is too small to affect the market price for the product: that is, on the buyers’ side, the market is competitive. Therefore, in its essence duopoly is a two-player variable-sum game. Each of the two duopolists is a rational decision-maker whose actions will affect both himself and his rival. Although the interests of the duopolists are intertwined, they are not wholly coincident nor wholly in conflict. In contrast to the agents in competitive markets, the duopolists must each concern themselves with what the other duopolist is likely to do.

Keywords

arenA Nash Monopoly Oligopoly 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Bibliography

  1. Bertrand, J. 1883. Review of Cournot (1838). Journal des Savants, 499–508.Google Scholar
  2. Bowley, A. 1924. The Mathematical Groundwork of Economics. New York: Kelley, 1965.Google Scholar
  3. Bowley, A. 1928. Bilateral monopoly. Economic Journal 38, 651–9.CrossRefGoogle Scholar
  4. Chamberlin, E. 1933. The Theory of Monopolistic Competition, 7th edn, Cambridge: Harvard, 1956.Google Scholar
  5. Cournot, A. 1838. Recherches sur les principes mathématiques de la théorie des richesses. Trans. N.T.Bacon, New York: Macmillan, 1927.Google Scholar
  6. Edgeworth, F. 1897. The pure theory of monopoly. Papers Relating to Political Economyvol.I, 111–42.Google Scholar
  7. Edgeworth, F. 1925. Papers Relating to Political Economy. New York: Burt Franklin, 1970.Google Scholar
  8. Friedman, J. 1968. Reaction functions and the theory of duopoly. Review of Economic Studies 35, 257–72.CrossRefGoogle Scholar
  9. Friedman, J. 1983. Oligopoly Theory. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
  10. Friedman, J. 1986. Game Theory with Applications to Economics. New York: Oxford University Press.Google Scholar
  11. Frisch, R. 1933. Monopole - polypole - la notion de force dans l’économie. Festschrift til Harald Westergaard. Supplement to Nationalekonomisk Tidsskrift.Google Scholar
  12. Hotelling, H. 1929. Stability in competition. Economic Journal 39, 41–57.CrossRefGoogle Scholar
  13. Lancaster, K. 1979. Variety, Equity, and Efficiency. New York: Columbia University Press.Google Scholar
  14. Nash, J. 1951. Noncooperative games. Annals of Mathematics 45, 286–95.CrossRefGoogle Scholar
  15. Owen, G. 1968. Game Theory. 2nd edn, New York: Academic Press, 1982.Google Scholar
  16. Selten, R. 1975. Reexamination of the perfectness concept for equilibrium points in extensive games. International Journal of Game Theory 4, 25–55.CrossRefGoogle Scholar
  17. Smith, A. 1776. An Inquiry into the Nature and Causes of the Wealth of Nations. Ed. R.H. Campbell, A.S. Skinner and W. M. Todd, Oxford: Clarendon Press, 1976.Google Scholar
  18. Stackelberg, H. von. 1934. Marktform und Gleichgewicht. Vienna: Julius Springer.Google Scholar
  19. Wicksell, K. 1925. Mathematical economics. In K. Wicksell, Selected Papers on Economic Theory, ed. Erik Lindahl, Cambridge, Mass.: Harvard University Press, 1958.Google Scholar

Copyright information

© Palgrave Macmillan, a division of Macmillan Publishers Limited 1989

Authors and Affiliations

  • James W. Friedman

There are no affiliations available

Personalised recommendations