Taking a traditional approach, I show that by using the discrete adjustment system, the Cournot solution in a free entry oligopoly with increasing returns to scale is stable only when the number of firms is very small. We must pay attention to stability when using the free entry Cournot...

This paper investigates the effects of exclusive territories in the presence of upstream competition. We consider the vertical dealings among two upstream firms and four downstream firms and find that exclusive territories may be more beneficial for consumers and more harmful for producers than...