Published March 1984
| Submitted
Working Paper
Open
On the Existence of Cournot Equilibrium
- Creators
- Novshek, William
Chicago
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Abstract
This paper examines the existence of n-firm Cournot equilibrium in a market for a single homogeneous commodity. It proves that if each firm's marginal revenue declines as the aggregate output of other firms increases (which is implied by concave inverse demand) then a Cournot equilibrium exists, without assuming that firms have nondecreasing marginal cost or identical technologies. Also, if the marginal revenue condition fails at a "potential optimal point," there is a set of firms such that no Cournot equilibrium exists. The paper also contains an example of nonexistence with two nonidentical firms, each with constant returns to scale production.
Additional Information
This research was supported by National Science Foundation Grant SES 79-25690 at the Institute for Mathematical Studies in the Social Sciences, Stanford University. This is a revision of IMSSS Technical report 420. I am grateful to participants in the USC Modeling Research Group Economic Theory seminar and the UCLA Mathematical Economics Theory Workshop for their comments. All errors are my own. Published as Novshek, William. "On the existence of Cournot equilibrium." The Review of Economic Studies 52.1 (1985): 85-98.Attached Files
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Additional details
- Eprint ID
- 81627
- Resolver ID
- CaltechAUTHORS:20170920-133247687
- NSF
- SES-7925690
- Created
-
2017-09-20Created from EPrint's datestamp field
- Updated
-
2019-10-03Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 517