Competitive Strategy
Key Concept:
Competitors� Responses
Pharmaceutical Example
Monopolistic Competition and Oligopoly
PPT Slide
Two Competitors
Reaction Curve
Duopoly Example
Total revenue for the two firms is:
More Competition
A Different Model of Competitive Interaction
Prisoners� Dilemma
Note: profits = (price - cost) * sales = $(8-4) * 2.5 = 10, etc.
Collusion and PD
Now change the payoff matrix slightly:
Now consider this case:
Finally, go back to the prisoners� dilemma case:
Polystyrene Base Case
MAXCO-Gambit Case Calculation of Expected Value
The MAXCO - Gambit Case
Email: [email protected]
Home Page: www.gsb.columbia.edu/faculty/gheal