Posted: September 13th, 2017
Critically discuss the view that the Cournot, Bertrand and Stackelberg models of oligopoly are fundamentally flawed and are unable to explain recent events in the
markets and industries.
1. Introduction – 150 words
2. Theory – 600 words
3. Analysis and empirical examples – 600 words
4. Conclusion – 150 words
Detailed structure:
Cournot oligopoly – explain and present the model with mathematical equations and graphs
1. Main assumptions
2. Cournot equilibrium (Nash)
3. Implications of Cournot’s assumptions
4. Reaction curves approach – “Iso – profit curves” – present with graph
5. Limitations of the model
6. Empirical example
Bertrand’s Model – “Buyer’s perspective”
1. Assumptions
2. Bertrand equilibrium
3. Iso – profit locus: Bertrand’s Model – explanation + graph
4. Implications of the model
5. Limitations
6. Bertrand’s equilibrium with differentiated products
7. Example
Stackelberg’s models – “Price leadership”
1. Stackelberg’s model: Leader’s demand curve;
2. Present the model with equations and graph
3. Present Stackelberg’s equilibrium + graph
4. Limitations of the model: Stackelberg games
5. Example
Compare the three non-collusive models: Bertrand, Cournot and Stackelberg
The essay should be an analytical answer to the topic.
Example references:
Giocoli, N. (2004), “Nash equilibrium”, History of political economy, 36 (4): 639-666
Dimand, R. W. and Dore, M. H. I. (1999), “Cournot, Bertrand and Game Theory: A further note”, American Economic Journal, 27 (3): 325-33
Estrin, Dietrich and Laidler (2012), Microeconomics – Chapters 13 and 15
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET AN AMAZING DISCOUNT 🙂
Place an order in 3 easy steps. Takes less than 5 mins.