Separating sequential equilibrium in a Bayesian international duopoly

Pinto, Alberto A.; Ferreira, Fernanda A.; Ferreira, Flávio

http://hdl.handle.net/10400.22/7293

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Authors

Pinto, Alberto A.

Ferreira, Fernanda A.

Ferreira, Flávio

Abstract(s)

We consider two Cournot firms, one located in the home country and the other in the foreign country, producing substitute goods for consumption in a third country. We suppose that neither the home government nor the foreign firm know the costs of the home firm, while the foreign firm cost is common knowledge. We determine the separating sequential equilibrium outputs.