In the rank of behavioral rules, imitation-based heuristics have received special attention in economics (see Vega-Redondo, 1997; Schlag, 1998). In particular, imitative behavior explains the evidence from experimental oligopolies where the Cournot–Nash equilibrium does not emerge as unique outcome and outputs are placed, for the most part, on fairly competitive levels (see e.g. Apesteguia et al., 2006 and Oechssler et al., 2016). Here, we derive a dynamic model of a linear Cournot oligopoly with a deterministic structure where rational agents having perfect foresight and imitators are present. The Cournot–Nash equilibrium is a stationary state of our models together with a further production level that can be interpreted as the competitive equilibrium in case only imitators are present. We found that the heterogeneities among players influence the stability properties of the Cournot–Nash equilibrium and the arising dynamical scenarios are characterized by similar features as those from experimental outcomes.

Cerboni Baiardi, L., Naimzada, A. (2019). An oligopoly model with rational and imitation rules. MATHEMATICS AND COMPUTERS IN SIMULATION, 156, 254-278 [10.1016/j.matcom.2018.09.005].

An oligopoly model with rational and imitation rules

Cerboni Baiardi, L
;
Naimzada AK
2019

Abstract

In the rank of behavioral rules, imitation-based heuristics have received special attention in economics (see Vega-Redondo, 1997; Schlag, 1998). In particular, imitative behavior explains the evidence from experimental oligopolies where the Cournot–Nash equilibrium does not emerge as unique outcome and outputs are placed, for the most part, on fairly competitive levels (see e.g. Apesteguia et al., 2006 and Oechssler et al., 2016). Here, we derive a dynamic model of a linear Cournot oligopoly with a deterministic structure where rational agents having perfect foresight and imitators are present. The Cournot–Nash equilibrium is a stationary state of our models together with a further production level that can be interpreted as the competitive equilibrium in case only imitators are present. We found that the heterogeneities among players influence the stability properties of the Cournot–Nash equilibrium and the arising dynamical scenarios are characterized by similar features as those from experimental outcomes.
Articolo in rivista - Articolo scientifico
Dynamic instability; Dynamical systems; Heterogeneity; Imitation;
Imitation, Heterogeneity, Dynamic instability, Dynamical systems
English
2019
2019
156
254
278
none
Cerboni Baiardi, L., Naimzada, A. (2019). An oligopoly model with rational and imitation rules. MATHEMATICS AND COMPUTERS IN SIMULATION, 156, 254-278 [10.1016/j.matcom.2018.09.005].
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10281/222448
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