Strong Time-Consistency in the Cartel-versus-Fringe Model

A.M. Groot, C.A.A.M. Withagen, A.J. de Zeeuw

Research output: Working paperDiscussion paperOther research output

307 Downloads (Pure)

Abstract

In the seventies and eighties, the theory of exhaustible natural resources developed a branch, which was called the cartel-versus-fringe model, to characterize markets with one large coherent cartel and a big number of small suppliers named the fringe.It was considered appropriate to use the von Stackelberg solution concept but because solutions could only be derived in an open-loop framework time-inconsistency resulted.This paper solves time-inconsistency in the cartel-versus-fringe model and provides the feedback von Stackelberg equilibrium for all cost configurations.
Original languageEnglish
Place of PublicationTilburg
PublisherMicroeconomics
Number of pages32
Volume1996-22
Publication statusPublished - 1996

Publication series

NameCentER Discussion Paper
Volume1996-22

Fingerprint

Cartel
Time consistency
Time inconsistency
Stackelberg
Stackelberg equilibrium
Natural resources
Solution concepts
Suppliers
Costs

Keywords

  • natural resources
  • cartels
  • game theory
  • consistency

Cite this

Groot, A. M., Withagen, C. A. A. M., & de Zeeuw, A. J. (1996). Strong Time-Consistency in the Cartel-versus-Fringe Model. (CentER Discussion Paper; Vol. 1996-22). Tilburg: Microeconomics.
Groot, A.M. ; Withagen, C.A.A.M. ; de Zeeuw, A.J. / Strong Time-Consistency in the Cartel-versus-Fringe Model. Tilburg : Microeconomics, 1996. (CentER Discussion Paper).
@techreport{d6fb278a1af54097ae4078511b16f527,
title = "Strong Time-Consistency in the Cartel-versus-Fringe Model",
abstract = "In the seventies and eighties, the theory of exhaustible natural resources developed a branch, which was called the cartel-versus-fringe model, to characterize markets with one large coherent cartel and a big number of small suppliers named the fringe.It was considered appropriate to use the von Stackelberg solution concept but because solutions could only be derived in an open-loop framework time-inconsistency resulted.This paper solves time-inconsistency in the cartel-versus-fringe model and provides the feedback von Stackelberg equilibrium for all cost configurations.",
keywords = "natural resources, cartels, game theory, consistency",
author = "A.M. Groot and C.A.A.M. Withagen and {de Zeeuw}, A.J.",
note = "Pagination: 32",
year = "1996",
language = "English",
volume = "1996-22",
series = "CentER Discussion Paper",
publisher = "Microeconomics",
type = "WorkingPaper",
institution = "Microeconomics",

}

Groot, AM, Withagen, CAAM & de Zeeuw, AJ 1996 'Strong Time-Consistency in the Cartel-versus-Fringe Model' CentER Discussion Paper, vol. 1996-22, Microeconomics, Tilburg.

Strong Time-Consistency in the Cartel-versus-Fringe Model. / Groot, A.M.; Withagen, C.A.A.M.; de Zeeuw, A.J.

Tilburg : Microeconomics, 1996. (CentER Discussion Paper; Vol. 1996-22).

Research output: Working paperDiscussion paperOther research output

TY - UNPB

T1 - Strong Time-Consistency in the Cartel-versus-Fringe Model

AU - Groot, A.M.

AU - Withagen, C.A.A.M.

AU - de Zeeuw, A.J.

N1 - Pagination: 32

PY - 1996

Y1 - 1996

N2 - In the seventies and eighties, the theory of exhaustible natural resources developed a branch, which was called the cartel-versus-fringe model, to characterize markets with one large coherent cartel and a big number of small suppliers named the fringe.It was considered appropriate to use the von Stackelberg solution concept but because solutions could only be derived in an open-loop framework time-inconsistency resulted.This paper solves time-inconsistency in the cartel-versus-fringe model and provides the feedback von Stackelberg equilibrium for all cost configurations.

AB - In the seventies and eighties, the theory of exhaustible natural resources developed a branch, which was called the cartel-versus-fringe model, to characterize markets with one large coherent cartel and a big number of small suppliers named the fringe.It was considered appropriate to use the von Stackelberg solution concept but because solutions could only be derived in an open-loop framework time-inconsistency resulted.This paper solves time-inconsistency in the cartel-versus-fringe model and provides the feedback von Stackelberg equilibrium for all cost configurations.

KW - natural resources

KW - cartels

KW - game theory

KW - consistency

M3 - Discussion paper

VL - 1996-22

T3 - CentER Discussion Paper

BT - Strong Time-Consistency in the Cartel-versus-Fringe Model

PB - Microeconomics

CY - Tilburg

ER -

Groot AM, Withagen CAAM, de Zeeuw AJ. Strong Time-Consistency in the Cartel-versus-Fringe Model. Tilburg: Microeconomics. 1996. (CentER Discussion Paper).