Firms` Strategic Decisions Theoretical and Empirical Findings

Volume: 1

Indexed in: EBSCO.

This eBook presents recent case studies on firms and their strategy employed in specific scenarios and industries. Readers will find, in this volume, an analysis of oligopolistic industries done by ...
[view complete introduction]

US $
15

*(Excluding Mailing and Handling)



Consistent Conjectural Variations Equilibrium in a Mixed Oligopoly with a Labor Input Function

Pp. 114-138 (25)

Vyacheslav V. Kalashnikov, Vitaliy V. Kalashnikov-Jr, Aarón Arévalo Franco and Felipe J. Castillo Pérez

Abstract

The present chapter studies conjectured variations equilibrium states (CVEs) in a mixed oligopoly model. It is different from a classical oligopoly in that a labormanaged firm is involved. The agents (including the labor-managed firm) when making decisions use conjectures about how the market clearing price can vary as a result of varying their supplies. The concept of equilibrium with the conjectures is different from the classical Cournot-Nash one. Under fixed feasible conjectures, the existence and uniqueness theorems for the conjectured variations equilibrium (called the exterior equilibrium) are proven. With an aim to specify a more complicated notion of the interior equilibrium, a consistency criterion for the conjectures (called also as influence coefficients) is proposed. The existence of at least one consistent conjectural variations equilibrium state (CCVE) is also established. Numerical experiments with a small test oligipoly are also described.

Keywords:

Consistent conjectural variations equilibrium, exterior equilibrium, homogeneous good, income per worker, influence coefficients, interior equilibrium, labor managed firm, labor input function, mixed oligopoly, Nash- Cournot equilibrium.

Affiliation:

Department of Systems and Industrial Engineering (IIS), Tecnológico de Monterrey (ITESM), Campus Monterrey, Ave. Eugenio Garza Sada 2501 Sur, Monterrey 64849, Mexico.