The paper provides a micro-founded differentiated duopoly illustration of a beauty contest, in which the relative …

given duopoly game as well as their intention to cooperate or not with their rival. The cooperation and timing formation … check for the existence of a subgame perfect Nash equilibrium (in pure strategies) of such a cooperation-timing duopoly game …. Two main results on the emergence of cooperation are provided. If players' actions in the symmetric duopoly game are …