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Cournot Competition and Endogenous Firm Size

Author

Listed:
  • Jason Barr

    (Department of Economics - Tilburg University [Netherlands])

  • Francesco Saraceno

    (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po)

Abstract
We study the dynamics of firm size in a repeated Cournot game with unkown demand function.We model the firm as a type of artificial neural network. Each period it must learn to map environmental signals to both demand parameters and its rival's output choice. But this learning game is in the background, as we focus on the endogenous adjustment of network size. We investigate the long-run behavior of firm/network size as a function of profits, rival's size, and the type of adjustment rules used.

Suggested Citation

  • Jason Barr & Francesco Saraceno, 2005. "Cournot Competition and Endogenous Firm Size," Working Papers hal-01052859, HAL.
    • Handle: RePEc:hal:wpaper:hal-01052859
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-01052859
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Firm size; adjustment dynamics; artificial neural networks; Cournot games;
    All these keywords.

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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