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A note on Stackelberg competition

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Julien, Ludovic A. [UCL]

This note investigates a Stackelberg-Nash competition model. We determine the conditions under which the leaders may achieve better profits than the followers when all firms compete on quantity in a two stage game. We focus on the properties of the followers' best response functions. It is shown that the Stackelberg equilibrium may coincide with the Cournot equilibrium. In addition, the followers may achieve higher profits than the leaders. Such results put forward the working and the consequences of strategic complementarities. These results are illustrated with three examples. © 2011 Springer-Verlag.

Document type Article de périodique (Journal article) – Article de recherche
Access type Accès restreint
Publication date 2011
Language Anglais
Journal information "Journal of Economics/ Zeitschrift fur Nationalokonomie" - Vol. 103, no. 2, p. 171-187 (2011)
Peer reviewed yes
issn 0931-8658
Publication status Publié
Affiliation UCL - SSH/LIDAM/IRES - Institut de recherches économiques et sociales
Links
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Bibliographic reference Julien, Ludovic A.. A note on Stackelberg competition. In: Journal of Economics/ Zeitschrift fur Nationalokonomie, Vol. 103, no. 2, p. 171-187 (2011)
Permanent URL http://hdl.handle.net/2078.1/163655