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Strategic vertical foreign investment under exchange rate uncertainty

Roy, Santanu; Viaene, Jean-Marie - 1996

This paper investigates the strategic incentives for vertical foreign investment by risk-neutral oligopolistic firms and the effect of exchange rate uncertainty on such investment. Firms competing in a domestic final good market meet their input requirements through import. They have the option...

Persistent link: https://www.econbiz.de/10009620813

Cost uncertainty in an oligopoly with endogenous entry

De Pinto, Marco; Goerke, Laszlo - 2021

How does cost uncertainty affect the welfare consequences of an oligopoly? To answer this question, we investigate a … Cournot oligopoly in which firms produce a homogeneous commodity and market entry is feasible. Marginal costs are unknown ex …-up. Furthermore, the welfare loss due to oligopoly tends to increase with uncertainty. …

Persistent link: https://www.econbiz.de/10012620737

Oligopoly and Risk Aversion

Asplund, Marcus - 1998

In this paper we consider how the degree of risk aversion, and demand/cost uncertainty, influence competition on oligopolistic markets. Under demand uncertainty, the best response strategies (both quantities and prices) are decreasing in risk aversion, but for cost uncertainty, quantities are...

Persistent link: https://www.econbiz.de/10014109903

Oligopoly as a socially embedded dilemma : an experiment

Engel, Christoph; Zhurakhovska, Lilia - 2011

expected. -- Oligopoly ; Collusion ; experiment ; Uncertainty ; negative externalities ; prisoner's dilemma …

Persistent link: https://www.econbiz.de/10008822475

Does Cost Uncertainty in the Bertrand Model Soften Competition?

Lagerlöf, Johan N. M. - 2014

The answer is no. Although naive intuition may suggest the opposite, uncertainty about costs in the homogeneous-good Bertrand model intensifies competition: it lowers price and raises total surplus (but also makes profits go up). For some economic environments, this is implied by Hansen's (RAND,...

Persistent link: https://www.econbiz.de/10013054742

The choice of prices vs. quantities under uncertainty

Reisinger, Markus; Reßner, Ludwig - 2007 - This Version: May 2007

This paper analyzes a duopoly model with stochastic demand in which firms first choose their strategy variable and compete afterwards. Contrary to the existing literature, we show that firms do not always choose a quantity which is the variable that induces a smaller degree of competition. The...

Persistent link: https://www.econbiz.de/10010383028

Strategic Exploitation of a Common Resource under Environmental Risk

Fesselmeyer, Eric - 2014

We study the effect of environmental risk on the extraction of a common resource. Using a dynamic and non-cooperative game in which an environmental event impacts the renewability and the quality of the resource, we show that the anticipation of such an event has an ambiguous effect on...

Persistent link: https://www.econbiz.de/10013070501

Switching Costs, Dynamic Uncertainty, and Buyer-Seller Relationships

Murthy, Nagesh - 2007

We analyze strategic relationships between buyers and sellers in markets with switching costs and dynamic uncertainty by investigating the scenario wherein a representative buyer trades with two foreign sellers located in the same foreign country. We show that, under exchange rate uncertainty,...

Persistent link: https://www.econbiz.de/10012776363

Ranking supply function and cournot equilibria in a differentiated product duopoly with demand uncertainty

Sağlam, İsmail - In: Games 9 (2018) 3/60, pp. 1-13

In this paper, we provide a welfare ranking for the equilibria of the supply function and quantity competitions in a differentiated product duopoly with demand uncertainty. We prove that the expected consumer surplus is always higher under the supply function competition, irrespective of whether...

Persistent link: https://www.econbiz.de/10011891023

Bertrand Under Uncertainty : Private and Common Costs

Lagerlöf, Johan N. M. - 2016

This paper proposes an n-firm homogeneous-good Bertrand model with private information about costs. The model allows for any non-negative correlation between the cost draws and for any demand elasticity but still yields a closed-form solution. The solution is simple, in pure strategies, and...

Persistent link: https://www.econbiz.de/10012999083

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