Abstract :
Extended Oligopoly models will be introduced and examined in which the
firms might face capacity limits, thresholds for minimal and maximal moves,
and antitrust thresholds in the case of partial cooperation. Similar situation
occurs when there is an additional cost of output adjustment, which is
discontinuous at zero due to set-up costs. In these cases the payoff functions
of the firms are nondifferentiable and in some cases even discontinuous.
Under the usual concavity assumptions Cournot oligopolies have monotonic
response functions and unique Cournot-Nash equilibrium. However the
introduction of these more realistic additions into the oligopoly models creates
a fundamentally new situation: the existence of no equilibrium or the presence
of multiple, in some cases even infinitely many, equilibria. It also results in a
very different asymptotic behavior of the dynamic extensions. The paper gives
a brief survey of the relevant models, derives the response functions of the
firms, and examines the existence and the number of equilibria. In the case of
infinitely many equilibria the equilibrium-set will be also determined and
characterized.
