On the stability of Cournot equilibrium when the number of competitors increases

Journal article | Zeitschriftenartikel

This article reconsiders whether the Cournot equilibrium really becomes a perfect competition equilibrium when the number of competitors goes to infinity. It has been questioned whether the equilibrium remains stable with an increasing number of firms. Contraindications were given for linear and for isoelastic demand functions. However, marginal costs were then taken as constant, which means adding more potentially infinite-sized firms. As we want to compare cases with few large firms to cases with many small firms, the model is tuned so as to incorporate capacity limits, decreasing with an increasing number of firms. Then destabilization is avoided.

Object Details

• Extent: Seite(n): 445-456
• Language: Englisch
• Notes: Status: Postprint; begutachtet (peer reviewed)

References and Relationships

• Bibliographic citation: Journal of Economic Behavior & Organization, 66(3-4)

Classification and Topics

• Subject: Wirtschaft ; Volkswirtschaftslehre

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Puu, Tonu
• Event: Veröffentlichung
• (where): Niederlande
• (when): 2008

Further information

• DOI: https://doi.org/10.1016/j.jebo.2006.06.010
• URN: urn:nbn:de:0168-ssoar-248082
• Rights: GESIS - Leibniz-Institut für Sozialwissenschaften. Bibliothek Köln
• Last update: 21.06.2024, 4:26 PM CEST