Cournot Equilibrium Uniqueness: At 0 Discontinuous Industry Revenue and Decreasing Price Flexibility

摘要

We consider the equilibrium uniqueness problem for a large class of Cournot oligopolies with convex cost functions and a proper price function p with decreasing price flexibility. This class allows for (at 0) discontinuous industry revenue and in particular for p(y) = y~(-α) The paper illustrates in an exemplary way the Selten-Szidarovszky technique based on virtual backward reply functions. An algorithm for the calculation of the unique equilibrium is provided.