Cournot Competition on a Network of Markets and Firms
Data
01.01.2009
01.01.2009
Autori
Rahmi Ilkiliç
Codice JEL
C62,C72,D85,L11
C62,C72,D85,L11
Parole chiave:
Cournot Markets,Networks,Nash Equilibrium,Centrality Measures
Cournot Markets,Networks,Nash Equilibrium,Centrality Measures
Publisher
Climate Change and Sustainable Development
Climate Change and Sustainable Development
Editor
Carlo Carraro
Carlo Carraro
Suppose markets and firms are connected in a bi-partite network, where firms can only supply to the markets they are connected to. Firms compete a la Cournot and decide how much to supply to each market they have a link with. We assume that markets have linear demand functions and firms have convex quadratic cost functions. We show there exists a unique equilibrium in any given network of firms and markets. We provide a formula which expresses the quantities at an equilibrium as a function of a network centrality measure.