Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

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Tuesday, December 3, 2013

Information exchange in a Cournot duopoly with nonlinear demand function

Fabio Tramontana (Department of Economics and Management, University of Pavia) discusses Information exchange in a Cournot duopoly with nonlinear demand function.

ABSTRACT:  We study information sharing in a Cournot duopoly with isoelastic demand function, when the elasticity is uncertain. This is one of the first attempts to analyze the role of nonlinearity in such a framework. We found important results about the profitability of sharing informations when marginal costs are high and/or the variance between elasticity values is low. From the point of view of welfare considerations, not sharing information seems to be the best scenario.

http://lawprofessors.typepad.com/antitrustprof_blog/2013/12/information-exchange-in-a-cournot-duopoly-with-nonlinear-demand-function.html

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