Dynamic duopoly: Prices and quantities

Jean Pierre Benoit; Vijay Krishna

doi:10.2307/2297443

Dynamic duopoly: Prices and quantities

Jean Pierre Benoit, Vijay Krishna

Economics

Research output: Contribution to journal › Article › peer-review

86 Scopus citations

Abstract

We study a dynamic model of duopoly in which firms choose both prices and quantities. If quantity (capacity) choices are relatively inflexible, firms generally carry excess (idle) capacity in equilibrium. Because of this enforcement cost, firms are unable to achieve monopoly levels. This contrasts with models in which which firms compete in either prices or quantities alone. On the other hand, if capacities are flexible firms may be able to sustain monopoly behaviour.

Original language	English (US)
Pages (from-to)	23-35
Number of pages	13
Journal	Review of Economic Studies
Volume	54
Issue number	1
DOIs	https://doi.org/10.2307/2297443
State	Published - Jan 1987

All Science Journal Classification (ASJC) codes

Economics and Econometrics

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10.2307/2297443

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title = "Dynamic duopoly: Prices and quantities",

abstract = "We study a dynamic model of duopoly in which firms choose both prices and quantities. If quantity (capacity) choices are relatively inflexible, firms generally carry excess (idle) capacity in equilibrium. Because of this enforcement cost, firms are unable to achieve monopoly levels. This contrasts with models in which which firms compete in either prices or quantities alone. On the other hand, if capacities are flexible firms may be able to sustain monopoly behaviour.",

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Dynamic duopoly: Prices and quantities

Abstract

All Science Journal Classification (ASJC) codes

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