Effect of information asymmetry in Cournot duopoly game with bounded rationality. (English) Zbl 1433.91047
Summary: We investigate the effect of information asymmetry on a dynamic Cournot duopoly game with bounded rationality. Concretely, we study how one player’s possession of information about the other player’s behavior in a duopoly affects the stability of the Cournot-Nash equilibrium. We theoretically and numerically show that the information stabilizes the Cournot-Nash equilibrium and suppresses chaotic behavior in the duopoly.
MSC:
91A80 | Applications of game theory |
91B54 | Special types of economic markets (including Cournot, Bertrand) |
37N40 | Dynamical systems in optimization and economics |
91A25 | Dynamic games |
Keywords:
discrete dynamical systems; Cournot duopoly games; bounded rationality; information asymmetry; complex dynamicsReferences:
[1] | Rubinstein, A., Modeling Bounded Rationality (1998), MIT Press: MIT Press Massachusetts |
[2] | Bischi, G. I.; Naimzada, A., Global analysis of a dynamic duopoly game with bounded rationality, Advances in Dynamic Games and Applications, 361-385 (2000), Springer · Zbl 0957.91027 |
[3] | Bischi, G. I.; Stefanini, L.; Gardini, L., Synchronization, intermittency and critical curves in a duopoly game, Math. Comput. Simul., 44, 6, 559-585 (1998) · Zbl 1017.91500 |
[4] | Puu, T., Chaos in duopoly pricing, ChaosSolitons Fractals, 1, 6, 573-581 (1991) · Zbl 0754.90015 |
[5] | Kopel, M., Simple and complex adjustment dynamics in Cournot duopoly models, Chaos Solitons Fractals, 7, 12, 2031-2048 (1996) · Zbl 1080.91541 |
[6] | Agiza, H.; Hegazi, A.; Elsadany, A., Complex dynamics and synchronization of a duopoly game with bounded rationality, Math. Comput. Simul., 58, 2, 133-146 (2002) · Zbl 1002.91010 |
[7] | Naimzada, A. K.; Sbragia, L., Oligopoly games with nonlinear demand and cost functions: two boundedly rational adjustment processes, Chaos Solitons Fractals, 29, 3, 707-722 (2006) · Zbl 1142.91340 |
[8] | Fanti, L.; Gori, L.; Sodini, M., Nonlinear dynamics in a Cournot duopoly with isoelastic demand, Math. Comput. Simul., 108, 129-143 (2015) · Zbl 1540.91035 |
[9] | Bischi, G. I.; Kopel, M., Equilibrium selection in a nonlinear duopoly game with adaptive expectations, J. Econ. Behav. Organ., 46, 1, 73-100 (2001) |
[10] | Agiza, H.; Elsadany, A., Nonlinear dynamics in the Cournot duopoly game with heterogeneous players, Physica A, 320, 512-524 (2003) · Zbl 1010.91006 |
[11] | Agiza, H.; Elsadany, A., Chaotic dynamics in nonlinear duopoly game with heterogeneous players, Appl. Math. Comput., 149, 3, 843-860 (2004) · Zbl 1064.91027 |
[12] | Angelini, N.; Dieci, R.; Nardini, F., Bifurcation analysis of a dynamic duopoly model with heterogeneous costs and behavioural rules, Math. Comput. Simul., 79, 10, 3179-3196 (2009) · Zbl 1169.91347 |
[13] | Cavalli, F.; Naimzada, A., A Cournot duopoly game with heterogeneous players: nonlinear dynamics of the gradient rule versus local monopolistic approach, Appl. Math. Comput., 249, 382-388 (2014) · Zbl 1338.91091 |
[14] | Elsadany, A., A dynamic Cournot duopoly model with different strategies, J. Egypt. Math. Soc., 23, 1, 56-61 (2015) · Zbl 1311.91040 |
[15] | Yassen, M.; Agiza, H., Analysis of a duopoly game with delayed bounded rationality, Appl. Math. Comput., 138, 2-3, 387-402 (2003) · Zbl 1102.91021 |
[16] | Agiza, H. N.; Bischi, G. I.; Kopel, M., Multistability in a dynamic Cournot game with three oligopolists, Mathem. Comput. Simul., 51, 1-2, 63-90 (1999) |
[17] | Agliari, A.; Gardini, L.; Puu, T., The dynamics of a triopoly Cournot game, Chaos Solitons Fractals, 11, 15, 2531-2560 (2000) · Zbl 0998.91035 |
[18] | Mas-Colell, A.; Whinston, M. D.; Green, J. R., Microeconomic Theory (1995), Oxford University Press: Oxford University Press New York · Zbl 1256.91002 |
[19] | Guo, Z.; Ma, J., The influence of information acquisition on the complex dynamics of market competition, Int. J. Bifurc. Chaos, 26, 01, 1650008 (2016) · Zbl 1334.91018 |
[20] | Shimada, I.; Nagashima, T., A numerical approach to ergodic problem of dissipative dynamical systems, Prog. Theor. Phys., 61, 6, 1605-1616 (1979) · Zbl 1171.34327 |
[21] | Sato, Y.; Akiyama, E.; Farmer, J. D., Chaos in learning a simple two-person game, Proc. Natl. Acad. Sci., 99, 7, 4748-4751 (2002) · Zbl 1015.91014 |
[22] | Galla, T.; Farmer, J. D., Complex dynamics in learning complicated games, Proc. Natl. Acad. Sci., 110, 4, 1232-1236 (2013) · Zbl 1292.91033 |
This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. In some cases that data have been complemented/enhanced by data from zbMATH Open. This attempts to reflect the references listed in the original paper as accurately as possible without claiming completeness or a perfect matching.