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| Atsuhiro Satoh and Yasuhito Tanaka |
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| ''Relative profit maximization and equivalence of Cournot and Bertrand equilibria in asymmetric duopoly'' |
| ( 2014, Vol. 34 No.2 ) |
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| We study the relation between a Cournot equilibrium and a Bertrand equilibrium in an emph{asymmetric} duopoly with differentiated goods in which each firm maximizes its relative profit that is the difference between its profit and the profit of the rival firm. Both demand and cost functions are linear but asymmetric, that is, demand functions for the goods are asymmetric and the firms have different marginal cots. We will show that a Cournot equilibrium and a Bertrand equilibrium coincide even in an asymmetric duopoly.
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| Keywords: asymmetric duopoly, relative profit maximization, equivalence of Cournot and Bertrand equilibria |
JEL: D4 - Market Structure and Pricing: General
L1 - Market Structure, Firm Strategy, and Market Performance: General |
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| Manuscript Received : Jul 03 2013 | | Manuscript Accepted : Apr 23 2014 |
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