This paper analyzes cartel stability when firms are farsighted. It studies a price leadership model as the one by D'Aspremont et al. (1983), where the dominant cartel acts as a leader by determining the market price, while the fringe behaves competitively. According to D'Aspremont et al.'s notion of cartel stability, a firm will not remain in a cartel as long as it prefers the outcome where it is the only member leaving the cartel for the fringe. Such an approach implies that the firm is myopic since it ignores whether its alternative is stable itself. Our notion captures foresight by employing a solution concept built in the spirit of von Neumann and Morgenstern (1944) stable set, yet adopting an indirect dominance a la Harsanyi (1974).
| Identifer | oai:union.ndltd.org:LACETR/oai:collectionscanada.gc.ca:QMM.30161 |
| Date | January 1999 |
| Creators | Diamantoudi, Effrosyni. |
| Contributors | Greenberg, Joseph (advisor) |
| Publisher | McGill University |
| Source Sets | Library and Archives Canada ETDs Repository / Centre d'archives des thèses électroniques de Bibliothèque et Archives Canada |
| Language | English |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
| Format | application/pdf |
| Coverage | Master of Arts (Department of Economics.) |
| Rights | All items in eScholarship@McGill are protected by copyright with all rights reserved unless otherwise indicated. |
| Relation | alephsysno: 001746033, proquestno: MQ64143, Theses scanned by UMI/ProQuest. |
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