This article presents a stochastic dynamic Generalized Nash-Cournot model to describe the evolution of the natural gas markets. The major gas chain players are depicted including: producers, consumers, storage, and pipeline operators, as well as intermediate local traders. Our economic structure...

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We demonstrate how suppliers can take strategic speculative positions in derivatives markets to soften competition in the spot market. In our game, suppliers first choose a portfolio of call options and then compete with supply functions. In equilibrium firms sell forward contracts and buy call...

This paper investigates dynamic process innovation in a product differentiated market where firms can reinvest present profits to reduce future costs. The focus is set on the market performance when the number of competing firms is determined by a social planner. The main contribution consists...

We investigate the relationship between competition and innovation using a dynamic oligopoly model that endogenizes both the long-run innovation rate and market structure. We use the model to examine how various determinants of competition, such as product substitutability, entry costs, and...

We study a complete information preemption game in continuous time. A finite number of firms decide when to make an irreversible, observable investment. Upon investment, a firm receives flow profits which decrease in the number of firms that have invested. The cost of investment declines over...

We use experiments to analyze what type of communication is most effective in achieving cooperation in a simple collusion game. Consistent with the theories of collusion and cheap talk, an initial burst of collusion rapidly collapses if subjects can only use a limited message space that does not...

The paper deals with an infinite horizon dynamic duopoly composed of price setting firms, producing differentiated products, with sales constrained by capacities that are increased or maintained by investments. We analyze continuous strategy Markov perfect equilibria, in which strategies are...