Osborne, Martin J; Pitchik, Carolyn - In: International Economic Review 28 (1987) 2, pp. 413-28
A model of a collusive duopoly in which each firm has limited capacity is studied. The negotiated output quotas depend on the bargaining power of the firms, which derives from the damage the firms can do by cutting prices. For fixed capacities, the unit profit of the small firm is at least as...