One-Leader and Multiple-Follower Stackelberg Games with Private Information

Tomoya Nakamura, Osaka University describes One-Leader and Multiple-Follower Stackelberg Games with Private Information.

ABSTRACT: This study analyzes one-leader and multiple-follower Stackelberg games with demand uncertainty. We demonstrate that the weight on public information regarding a follower's estimation of demand uncertainty determines the strategic relationship between the leader and each follower. When the relationship is strategic complement, the leader can exit from a market. The threshold is determined by the intensity of Cournot competition among the followers.