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- W3121738605 abstract "This paper develops a theoretical foundation for the undercut-proof equilibrium (see Shy, 1996, 2002; Morgan and Shy, 2013). In a general spatial setting, the set of undercut-proof prices is equivalent the core of a non-transferable utility coalitional-game, played on the set of outcomes that are feasible in Bertrand competition. The result depends critically on two conditions: First, firms must have unlimited capacity and constant marginal costs. Second, the goods produced by firms must only be differentiated by the spatial characteristics of the market. An application to network markets show how the undercut-proof equilibrium can be used to describe stable price dispersion and persistent performance differences." @default.
- W3121738605 created "2021-02-01" @default.
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- W3121738605 date "2014-01-01" @default.
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- W3121738605 title "A Theoretical Foundation for the Undercut-Proof Equilibrium" @default.
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- W3121738605 doi "https://doi.org/10.2139/ssrn.2533266" @default.
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