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Dynamic Cournot oligopoly game based on general isoelastic demand

  • J. AndaluzEmail author
  • A. A. Elsadany
  • G. Jarne
Original paper
  • 37 Downloads

Abstract

This paper explores a nonlinear Cournot oligopoly with n firms displaying general isoelastic demand. The marginal profits-based gradient rule and the expectation rule Local Monopolistic Approximation were employed in two Cournot oligopoly games. Nash equilibrium stability analysis is carried out on each of the two games to throw light on the effects of demand elasticity and other parameters on the dynamics of the game. Our results show that the influence of demand elasticity on stability depends on firms’ expectation rules.

Keywords

Cournot oligopoly General isoelastic demand Bounded rationality Local stability 

JEL Classification

C62 D43 L13 

Notes

Acknowledgements

The authors wish to thank the Spanish Ministry of Economics and Competitiveness (ECO2016-74940-P) and the Government of Aragon and FEDER (consolidated group S40_17R) for their financial support. The authors would like to express their thanks to the anonymous referees for their comments on earlier versions of this work.

Compliance with ethical standards

Conflict of interest

The authors declare that they have no conflict of interest.

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Copyright information

© Springer Nature B.V. 2019

Authors and Affiliations

  1. 1.Department of Economic AnalysisUniversity of ZaragozaZaragozaSpain
  2. 2.Mathematics Department, College of Sciences and Humanities Studies in Al-KharjPrince Sattam Bin Abdulaziz UniversityAl-KharjSaudi Arabia
  3. 3.Department of Basic Science, Faculty of Computers and InformaticsSuez Canal UniversityIsmailiaEgypt

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