TY - JOUR

T1 - Cournot, Bertrand or Chamberlin

T2 - Toward a reconciliation

AU - Parenti, Mathieu

AU - Sidorov, Alexander V.

AU - Thisse, Jacques François

AU - Zhelobodko, Evgeny V.

PY - 2017/3/1

Y1 - 2017/3/1

N2 - This paper compares the market equilibria in a differentiated industry under Cournot, Bertrand, and monopolistic competition. This is accomplished in a one-sector economy where consumers are endowed with separable preferences. When firms are free to enter the market, monopolistically competitive firms charge lower prices than oligopolistic firms, while the mass of varieties provided by the market is smaller under the former than the latter. If the economy is sufficiently large, Cournot, Bertrand and Chamberlin solutions converge toward the same market outcome, which may be a competitive or a monopolistically competitive equilibrium, depending on the nature of preferences.

AB - This paper compares the market equilibria in a differentiated industry under Cournot, Bertrand, and monopolistic competition. This is accomplished in a one-sector economy where consumers are endowed with separable preferences. When firms are free to enter the market, monopolistically competitive firms charge lower prices than oligopolistic firms, while the mass of varieties provided by the market is smaller under the former than the latter. If the economy is sufficiently large, Cournot, Bertrand and Chamberlin solutions converge toward the same market outcome, which may be a competitive or a monopolistically competitive equilibrium, depending on the nature of preferences.

KW - Bertrand competition

KW - Cournot competition

KW - free entry

KW - monopolistic competition

UR - http://www.scopus.com/inward/record.url?scp=85012000508&partnerID=8YFLogxK

U2 - 10.1111/ijet.12116

DO - 10.1111/ijet.12116

M3 - Article

AN - SCOPUS:85012000508

VL - 13

SP - 29

EP - 45

JO - International Journal of Economic Theory

JF - International Journal of Economic Theory

SN - 1742-7355

IS - 1

ER -