Journal
ECONOMICS LETTERS
Volume 107, Issue 3, Pages 356-359Publisher
ELSEVIER SCIENCE SA
DOI: 10.1016/j.econlet.2010.03.006
Keywords
Bertrand competition; Cost uncertainty; Mixed strategies
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We analyze the classical model of Bertrand competition in a homogeneous good market with constant marginal costs and uncertainty regarding rivals' costs. First, we show that there exists a mixed strategy Nash equilibrium under the conventional equal sharing rule. Second, we illustrate the result for the case of piecewise-affine market demand. (C) 2010 Elsevier B.V. All rights reserved.
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