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BERTRAND GAMES WITH LIFETIME EMPLOYMENT CONTRACTS AS A STRATEGIC COMMITMENT *
Author(s) -
OHNISHI KAZUHIRO
Publication year - 2006
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/j.1467-9957.2006.00508.x
Subject(s) - economics , microeconomics , bertrand competition , mathematical economics , cournot competition , oligopoly
This paper considers lifetime employment contracts as a strategic commitment and discusses the respective equilibrium outcomes of the two cases of a price‐setting game with substitute goods and a price‐setting game with complementary goods. As a result, it is shown that in each case, the equilibrium coincides with the Bertrand solution with no lifetime employment.