Journal
INTERNATIONAL JOURNAL OF PRODUCTION ECONOMICS
Volume 204, Issue -, Pages 148-159Publisher
ELSEVIER SCIENCE BV
DOI: 10.1016/j.ijpe.2018.07.026
Keywords
Cournot competition; Lot-sizing problem; Nash equilibria; Potential game
Categories
Funding
- IVADO fellowship
- Portuguese Foundation for Science and Technology (FCT) [SFRH/BD/79201/2011]
- ERDF European Regional Development Fund through the Operational Programme for Competitiveness and Internationalisation - COMPETE 2020 Programme within [POCI01-0145-FEDER-006961]
- National Funds through the FCT (Portuguese Foundation for Science and Technology) [UID/EEA/50014/2013]
Ask authors/readers for more resources
We study the strategical behaviour of firms facing a lot-sizing problem with Cournot competition. Each player is a firm with her own production facility, modeled as an uncapacitated lot-sizing problem (Le., production incurs set-up and variable costs and inventories are allowed). A Cournot competition is played in each time period (market) with each player deciding the quantity of product to place on it. The market price of that product in each time period depends on the total quantity placed in the market. We show that this is a potential game with possibly multiple pure Nash equilibria. We then investigate the plausibility of these equilibria to predict the game outcome by evaluating the difficulty of computing them. If the game has a single period, we prove that an equilibrium can be found in polynomial time, but it is weakly NP hard to find an optimal pure Nash equilibrium (with respect to a given equilibrium refinement). If the game has no variable production and inventory costs, we prove that a pure Nash equilibrium can be computed in polynomial time.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available