On the effects of entry in Cournot markets

Amir, Rabah;Lambson, Val
(1999)

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  • Amir, Rabah
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  • Lambson, Val
    Author
Abstract
In the framework of symmetric Cournot oligopoly, this paper provides two minimal sets of assumptions on the demand and cost functions that imply respectively that, as the number of firms increases, the minimal and maximal equilibria lead to (i) decreasing industry price and increasing or decreasing per-firm output; and (ii) increasing industry price (and decreasing per-firm output). In both cases, per-firm profits are decreasing. The analysis relies crucially on lattice-theoretic methods and yields general, unambiguous and easily interpretable conclusions of a global nature. As a byproduct of independent interest, new insight into existence of Cournot equilibrium is developed.
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Amir, R., & Lambson, V. (1999). On the effects of entry in Cournot markets (CORE Discussion Papers 1999/59). https://hdl.handle.net/2078.5/42609