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French

ID: <

10.7202/601335ar

>

·

DOI: <

10.7202/601335ar

>

Where these data come from
Competitive balance as the limit to follow on from Stackelberg’s strategic balances

Abstract

In this article, we consider an ordered Stackelberg framework. In such a context, leadership is the preferred position. We show, using a linear model, with constant average costs, that the larger the number of a firm's followers is, the larger its profit. However, as the number of firms increase, the industry's production converges to the competitive equilibrium level but the distribution of firms' size and profit remains significantly unequal. However, in terms of absolute profits, the rank advantage does disappear in the process. The convergence to a competitive equilibrium industry production level is preserved when we introduce fixed costs and replicate both the size of the market and the number of firms.

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