Nash Equilibrium in a Three‐Stage Model of Vertical Product Differentiation

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Аннотация

We examined a three-stage game-theoretical model of symmetric duopoly and vertical product differentiation. It is assumed, that there are two firms on some industrial market which produce homogeneous product differentiated by quality. We suppose as well that quality range is defined and firms can manage it. Thus, the talk presents the results of the research of a three-stage model of duopoly, when at the first stage companies define quality range, at the second one - quality level and at the last stage they compete in product price. The profit function of the firm i which produces the product of quality si , where si ∈ [s, s¯i] and ¯si ∈ [¯s0, s¯0 + ∆¯s] , is the following: Πi(p, s, s¯) = pi(s)Di(p, s) − c(si) − F(¯si), i = 1, 2, (1) where pi - product price of the firm i, p = (p1, p2) - a vector of product prices of the competitors, s = (s1, s2) - a vector of product qualities, Di(p, s) - the demand function for the product of quality si, which is specified, c(si) - production costs of the product of quality
Язык оригиналаанглийский
Название основной публикацииContributions to the 13th International Symposium on Dynamic Games and Applications
Страницы1-2
СостояниеОпубликовано - 2008

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Gladkova, M. A., & Zenkevich, N. A. (2008). Nash Equilibrium in a Three‐Stage Model of Vertical Product Differentiation. В Contributions to the 13th International Symposium on Dynamic Games and Applications (стр. 1-2)