Date of This Version
June 2009
Abstract
Suppose markets and firms are connected in a bi-partite network, where firms can only supply to the markets they are connected to. Firms compete a la Cournot and decide how much to supply to each market they have a link with. We assume that markets have linear demand functions and firms have convex quadratic cost functions. We show there exists a unique equilibrium in any given network of firms and markets. We provide a formula which expresses the quantities at an equilibrium as a function of a network centrality measure.
Recommended Citation
Ilkilic, Rahmi, "Cournot Competition on a Network of Markets and Firms" (June 22, 2009). Fondazione Eni Enrico Mattei Working Papers. Paper 293.
https://services.bepress.com/feem/paper293
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