Duopoly

Under oligopoly firms are often observed to specialise their production, with some firms producing highly reliable output and offering good warranty deals, while others produce less reliable output and offer less attractive warranties, but charge a lower price. This paper develops an approach to product/service reliability which provides an alternative to the conventional analysis based on the characteristics approach. The model of this paper defines reliability as the objective probability of product failure, not as a characteristic of individual goods. Reliability, thus defined, is treated as a choice variable of the firm, and consumers' preferences are partially endogenised. This approach to reliability is incorporated into a duopoly model which explains the phenomenon of specialisation described above. The model is applicable to the markets for consumer durables, some intermediate goods and some services.

Sur le marché des semi-conducteurs, deux géants se livrent une bataille féroce : Intel et AMD (Advance Micro Devices). Nous nous intéressons dans cet article à la compétition au sein du marché de microprocesseur de type x86 entre ces deux seuls joueurs en place. Nous exposons les grandes lignes de l’historique des firmes, la structure de secteur et les comportements concurrentielles entre les firmes. Un modèle simple est construit pour démontrer sur quelle mesure la différenciation verticale va impacter les caractéristiques de l’équilibre.

Adidas and Nike currently control 74% of the global football market, a prime example of duopoly. Their share is predicted to increase; consequently, it is crucially important for consumers to assess whether such a duopolistic setting is beneficial for them. In particular, London hosts the greatest number of footballers in the UK, and is a key playing field for the two firms. Thus, this essay investigates: ‘to what extent is a duopoly in the football industry in London beneficial to consumers?’

Firstly, the paper assesses how price in duopoly would change if we transitioned from duopoly, to monopolistic competition. The aim was to assess consumers’ monetary welfare. Secondly, it explores how the market structure influences quality. It uses research from world leading economists to argue that a duopolistic market leads to the highest R&D industry-wide. Thirdly, it analyses a 203-responses survey, which was conducted at football clubs in London to understand how much customers were willing to spend for a given level of R&D. The aim was to see whether a duopoly would have been consistent with their desired combination of price and quality. That way, we could judge whether deviating from duopoly would have benefited them. This analysis was complemented by an interview with a high-profile executive at Adidas.

The investigation finds that monopolistic competition would be more beneficial than duopoly in terms of price, as these would fall with more competition. However, it also reveals that duopoly is more beneficial than any other type of market structure in terms of quality, because of the higher amount of R&D. The analysis of consumer preferences ultimately proves that customers find the duopoly to be the most beneficial type of market structure in the football industry in London.

A  critique of the article “Yes, you do have an obligation to vote for the lesser of two evils. Here’s why," from the Washington Post (6/1/16). Attached is a final draft and a link to a version on the "It Is What It Isn't" Blog. See also the illustrated version on Academia.edu.

El presente trabajo aplica los modelos de Cournot y de Stackelberg a una industria de productos homogéneos con alto nivel de concentración. El objeto es usar estos modelos como criterio de decisión acerca de la alternativa de introducir una nueva marca por parte de un competidor actual. Se trata de establecer si lanzar una nueva marca sería una estrategia relevante para una empresa en la búsqueda de captar mayor mercado. Se asume que en un mercado de bienes básicos y homogéneos, la demanda no se modifica ante el ingreso de una nueva marca y que el espacio de mercado que absorbe la nueva marca, procede de la participación que resta de las marcas existentes. Se muestra como, la cantidad que produce cada competidor nuevamente converge con el equilibrio de Cournot, por lo cual, no existe beneficio adicional producto del lanzamiento de la marca nueva, si se supone racionalidad. Teóricamente las firmas con mejor posición en el mercado se verán menos inclinadas a lanzar nuevas marcas y preferirán mantener o mejorar su posicionamiento, las firmas con menos participación en el mercado serán las más inclinadas a realizar nuevos lanzamientos. Se concluye que la introducción de marcas en mercados homogéneos de bienes básicos poco diferenciados no es una estrategia interesante para incrementar la participación en el mercado cuando las marcas de quienes lanzan los productos no están bien posicionadas. Para los efectos de la ilustración de los planteamientos anteriores se utilizó como base la industria molinera de arroz blanco en Colombia.

Una política que fortalece la competencia a largo plazo en el sector postal es la actuación sobre los costes de cambio y de retención. En dos escenarios de duopolio, uno con costes de cambio y otro con costes de cambio y costes de retención, el objetivo del presente trabajo es descubrir en qué medida la variación de los costes de cambio de proveedor y de los costes de retención afectan al excedente del consumidor y al beneficio de las dos firmas y, en consecuencia, al bienestar social. Se desarrolla una ampliación propia del modelo seminal de Klemperer, que incorpora los costes de retención. La metodología consiste en la determinación y comparación de las situaciones del equilibrio Cournot-Nash. Los resultados obtenidos muestran la importancia de las políticas orientadas a la reducción de los costes de cambio de proveedor como una de las políticas que fortalecen la competencia a largo plazo en un servicio de interés general, como es el servicio postal

This paper explores the implication of evolutionary models (replicatordynamics) in a simple Cournot duopoly model. A firm type is a linear decisionrule in which the firm's output depends on the other firm's previous output.First we run an Axelrod Tournament between firm types. The champion firm isa near profit-maximizer. Secondly, we allow social evolution to occur usingreplicator dynamics. Here we find

This study showcases Uganda’s experience with the reform of the telecommunications sector that has taken place over the last decade. The reform of Uganda’s telecommunications sector has been billed as a more successful one in relation to experiences in other sectoral reforms, which provides motivation for the study. Incentive for the study also arises out of the need to document how the process was undertaken, particularly from the aspects that will inform the understanding of the design, management and implementation of the reform was undertaken. As a study meant to analyze the political economy of investment climate reform, it deals more with the legal, institutional and political nuances that underpinned the reform management process.

In a general setting with uncertainty and spillovers in R&D activity, we consider the incentive to cooperate among firms at any or all of the following three stages. Firms can jointly agree on the level of R&D expenditures, they can set up joint research facilities, and/or they can engage in an information sharing agreements, by which they agree to share any findings with the other firm. We compare expenditures on R&D, profit levels, and welfare levels across the different possible cooperative and competitive setups and offer antitrust implications. Our model differs from previous analyses in three important ways. First, most studies consider only research aimed at lowering production costs, and therefore consider only situations where total profits fall as spillovers increase. We allow for the possibility of product innovation, and define the concepts of offsetting spillovers (falling total profits) and incremental spillovers (when total profits increase as spillovers increase). Se...

In this paper, author examine the issue of the optimal tariff in circumstances in which trade between the ‘North’ (a developed country) and the ‘South’ (a developing country) takes place. Firms compete in quantities (‘Cournot competition’) in an imperfectly competitive Northern market. In addition, there are leakages of technological knowledge (‘spillovers’) from the North to the South. The interaction between tariffs and spillovers, together with its consequences for the social welfare of the North, is the focus of the paper. Another closely related motivation of this paper stems from the observation that the so called punitive tariffs are being used as device to punish violators of intellectual property rights.

In this paper we apply the Complete Analysis of Differentiable Games (introduced by D. Carfì in [3], [6], [8] and [9]) and already
employed by himself and others in [4], [5], [7]) and some new algorithms employing the software wxMaxima 11.04.0 in order to
reach a total knowledge of the classic Bertrand Duopoly (1883), viewed as a complex interaction between two competitive subjects,
in a particularly difficult asymmetric case. The software wxMaxima is an interface for the computer algebra system Maxima. Maxima
is a system for the manipulation of symbolic and numerical expressions, including differentiation, systems of linear equations, polynomials,
and sets, vectors, matrices. Maxima yields high precision numeric results by using exact fractions, arbitrary precision integers,
and variable precision floating point numbers. Maxima can plot functions and data in two and three dimensions. The Bertrand
Duopoly is a classic oligopolistic market in which there are two enterprises producing the same commodity and selling it in the same
market. In this classic model, in a competitive background, the two enterprises employ as possible strategies the unit prices of their
products, contrary to the Cournot duopoly, in which the enterprises decide to use the quantities of the commodity produced as strategies.
The main solutions proposed in literature for this kind of duopoly (as in the case of Cournot duopoly) are the Nash equilibrium
and the Collusive Optimum, without any subsequent critical exam about these two kinds of solutions. The absence of any critical
quantitative analysis is due to the relevant lack of knowledge regarding the set of all possible outcomes of this strategic interaction.
On the contrary, by considering the Bertrand Duopoly as a differentiable game (games with differentiable payoff functions) and
studying it by the new topological methodologies introduced by D. Carfì, we obtain an exhaustive and complete vision of the entire
payoff space of the Bertrand game (this also in asymmetric cases with the help of wxMaxima 11.04.0) and this total view allows us to
analyze critically the classic solutions and to find other ways of action to select Pareto strategies, in the asymmetric cases too. In
order to illustrate the application of this topological methodology to the considered infinite game, several compromise pricingdecisions
are considered, and we show how the complete study gives a real extremely extended comprehension of the classic model.

In this study, we analyze an advertising competition in a duopoly. We consider two different notions of equilibrium. We model the companies in the duopoly as major players, and the consumers as minor players. In our first game model we identify Nash Equilibria (NE) between all the players. Next we frame the model to lead to the search for Multi-Leader-Follower Nash Equilibria (MLF-NE). This approach is reminiscent of Stackelberg games in the sense that the major players design their advertisement policies assuming that the minor players are rational and settle in a Nash Equilibrium among themselves. This rationality assumption reduces the competition between the major players to a 2-player game. After solving these two models for the notions of equilibrium, we analyze the similarities and differences of the two different sets of equilibria.

The aim of this paper is to study the option to invest in a duopoly market, allowing for more competitors to enter the market. In fact, we relax the common assumption which states that (only) two firms compete for the two places in the market. In the existing models, the problem consists of, basically, defining which one will be the leader, which will be the follower, and when. We can say that, in these settings, the investment opportunities are semi-proprietary, since the follower’s position is, at least, guaranteed for both firms. As we said, our approach relaxes this assumption, allowing for more than two competitors for the positions on the duopoly. This additional competition has, as we will see, a major impact on the decision to invest. We also allow for both ex-post symmetry and ex-post asymmetry, and for asymmetrical investment costs for the leader and for the follower.

We study the effects of market structure on entry using data from the U.K. fast food (counter-service burger) industry over the years 1991--1995, for which the market can be characterized as a duopoly. We use both reduced-form estimations and a structural model, controlling for market-specific time-invariant unobservables. For both firms, we find that market structure matters greatly. Specifically, rival presence increases the probability of entry by increasing expected market size, whereas variable profits per customer are increasing in the number of own outlets. Our results suggest the presence of product differentiation, firm learning, and market power.

Competition is the cornerstone of successful telecommunications development. Morocco's telecommunications reforms in 1995-1999, which among other changes introduced competition in mobile phones, led to fast growth, and improved sector performance. Plans for further competition, however, did not materialize and the sector stagnated. As a result, Morocco lost its leading regional position and the country's overall competitiveness has been compromised. This paper provides a backdrop against which the Government can examine where Morocco stands today and the initiatives of the Agence Nationale de Reglementation des Telecommunications (ANRT's) to move forward. The paper focuses on changes in regulatory policy that would support the country's emerging e-agenda and would particularly help Moroccan businesses. Section II of this paper summarizes where Morocco stands at present, relative to its own past achievements in telecommunications and recent progress of other countries...

In this paper we apply the Complete Analysis of Differentiable Games (introduced by D. Carfi in [3], [6], [8] and [9]) and already employed by himself and others in [4], [5], [7]) and some new algorithms employing the software wxMaxima 11.04.0 in order to reach a total knowledge of the classic Bertrand Duopoly (1883), viewed as a complex interaction between two competitive subjects, in a particularly difficult asymmetric case. The software wxMaxima is an interface for the computer algebra system Maxima. Maxima is a system for the manipulation of symbolic and numerical expressions, including differentiation, systems of linear equations, polynomials, and sets, vectors, matrices. Maxima yields high precision numeric results by using exact fractions, arbitrary precision integers, and variable precision floating point numbers. Maxima can plot functions and data in two and three dimensions. The Bertrand Duopoly is a classic oligopolistic market in which there are two enterprises producing...