COURNOT AND STACKELBERG EQUILIBRIA IN THE AKERLOF MODEL
Journal Title: Вісник Одеського національного університету. Економіка. - Year 2017, Vol 22, Issue 1
Abstract
This paper investigates Cournot and Stackelberg equilibria in the Akerlof model. For this purpose, there is constructed a model of duopoly producers of high-quality and low-quality products, which compete in conditions of information asymmetry. The demand curve is described by a function with constant elasticity. In the model identified the corresponding states of equilibrium and conducted their comparative analysis. It is found that optimal for duopolists is the Stackelberg equilibrium, when leader – a manufacturer of high-quality product. It is determined that adverse selection is valid in all states of equilibrium.
Authors and Affiliations
S. V. Melnikov
Keywords
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