Blume (2003) examines Bertrand competition
with continuous strategy space, homogenous products, and different marginal costs and shows that for small enough [eta] > 0, the following is an equilibrium: The low-cost firm posts a price equal to [c.
One strategy is price competition which is often defined as Bertrand competition
in economics literature.
THE OPTIMAL NUMBER OF FIRMS UNDER BERTRAND COMPETITION
Under Bertrand competition
, firms take the prices of rivals as given.
For some time now, prominent antitrust economists have advocated models of differentiated Bertrand competition
, which appear to imply that merger of a subset of competitors necessarily raises price, or have made general statements that differentiated Bertrand competition
implies that merger of a subset of competitors always raises price.
Almost without exception in current industrial organization literature, market rivalry involving quantity strategies is referred to as Cournot competition and market rivalry involving price strategies is referred to as Bertrand competition
Lewis (2010)--in an earlier version of this study--and Colciago (2013) discuss supply-side complementarities, contrasting CES demand with Cournot and/or Bertrand competition
the lack of downstream regulation, Bertrand competition
in the downstream market, downstream market price elasticities on the order of 2.
Further, it is in the context of Bertrand competition
for undifferentiated products that ECPR can be proved to be efficient under extremely restrictive assumptions.
Cournot Precommitment and Bertrand Competition
Yield Cournot Outcomes.
TO show that entry by even an inefficient rival could yield socially beneficial results, we assume that the monopolist is restricted (e.
Section III identifies the properties of spatial prices under Bertrand competition
while section IV uncovers the behavioral determinants of single basing-point pricing.