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CHAOTIC PATTERNS IN COURNOT COMPETITION
Author(s) -
Witteloostuijn A.,
Lier A.
Publication year - 1990
Publication title -
metroeconomica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.256
H-Index - 29
eISSN - 1467-999X
pISSN - 0026-1386
DOI - 10.1111/j.1467-999x.1990.tb00464.x
Subject(s) - cournot competition , economics , chaotic , competition (biology) , monopoly , nonlinear system , microeconomics , mathematical economics , chaos theory , neoclassical economics , physics , management , ecology , quantum mechanics , biology
Chaos theory offers a new mode of analyzing the complexity of nonlinear (economic) dynamics. A growing list of applications is mainly focused on modeling macroeconomic (growth and business) cycles and dynamic (consumer's and firms') choice. This paper provides a nonlinear dynamic model of Cournot competition. The model improves upon Rand (1978) and Dana and Montrucchio (1986) by permitting monopoly output to be positive. The existence of chaotic regimes is proven and simulation experiments illustrate the implications.