3 research outputs found
Network Cournot Competition
Cournot competition is a fundamental economic model that represents firms
competing in a single market of a homogeneous good. Each firm tries to maximize
its utility---a function of the production cost as well as market price of the
product---by deciding on the amount of production. In today's dynamic and
diverse economy, many firms often compete in more than one market
simultaneously, i.e., each market might be shared among a subset of these
firms. In this situation, a bipartite graph models the access restriction where
firms are on one side, markets are on the other side, and edges demonstrate
whether a firm has access to a market or not. We call this game \emph{Network
Cournot Competition} (NCC). In this paper, we propose algorithms for finding
pure Nash equilibria of NCC games in different situations. First, we carefully
design a potential function for NCC, when the price functions for markets are
linear functions of the production in that market. However, for nonlinear price
functions, this approach is not feasible. We model the problem as a nonlinear
complementarity problem in this case, and design a polynomial-time algorithm
that finds an equilibrium of the game for strongly convex cost functions and
strongly monotone revenue functions. We also explore the class of price
functions that ensures strong monotonicity of the revenue function, and show it
consists of a broad class of functions. Moreover, we discuss the uniqueness of
equilibria in both of these cases which means our algorithms find the unique
equilibria of the games. Last but not least, when the cost of production in one
market is independent from the cost of production in other markets for all
firms, the problem can be separated into several independent classical
\emph{Cournot Oligopoly} problems. We give the first combinatorial algorithm
for this widely studied problem
A Combinatorial Polynomial Algorithm for the Linear Arrow-Debreu Market
We present the first combinatorial polynomial time algorithm for computing
the equilibrium of the Arrow-Debreu market model with linear utilities.Comment: Preliminary version in ICALP 201