08. Market Competition

1. Start

228: Networking III This video proves that Counot’s networking theory is self destructive.

2. Cournot

103: Cournot Competition IV This video works out Cournot’s quantity reaction functions.
100: Cournot Competition I This video proves that Cournot competition ends up with part of the market wasted.
101: Cournot Competition II This video proves that Cournot’s pricing policy is very erratic
102: Cournot Competition III This video proves that Cournot used only reduction to fight the price war.

3. Hotelling

109: Hotelling Games This video shows how to play the Hotelling spatial competition games.
080: Location Choice I This video works out the first round of Hotelling’s spatial competition game.
081: Location Choice II This video works out the second round of Hotelling’s spatial competition game.
082: Location Choice III This video works out the equilibrium after interaction of Hotelling’s spatial competition game.
083: Location Choice IV This video proves the first theorem of Hotelling’s spatial competition game: equi-distance.
094: Location Choice IX This video shows how two duopolists take over the whole market, not just half of it.
108: Hotelling & Cournot V This video works out the quantity reaction functions that cover the whole market.
084: Location Choice V This video disproves AGT’s claim that sellers do not move toward the center.

4. Anti-Hotelling

087: Maximum Differentiation III This video confirms the conclusion by AGT that sellers do not move toward the center. But, …
085: Maximum Differentiation I This video works out the first round of AGT’s spatial competition game with quadratic commuting cost.
086: Maximum Differentiation II This video works out the second round, and the equilibrium after interaction, of AGT’s spatial competition game with quadratic commuting cost.
092: Circular Location II This video proves that Salop’s model is just Hotelling’s model.
093: Circular Location III This video works out a solid circular spatial competition model.

5. Cost

088: Location Choice VI This video disproves the conclusion by both Hotelling and AGT that it pays to make consumers miserable.
095: Location Choice X This video proves that commuting cost reduces a monopolist’s profit.
097: Location & Production Cost I This video introduces production cost into the Hotelling model.
098: Location & Production Cost II This video proves that production cost does not raise Hotelling’s profit.

6. Oligopoly

110: Kinked Demand I This video proves that the kinked demand model has too many optimal points.
111: Kinked Demand II This video proves that the monopolist demand curve in the kinked demand model is redundant.
099: Location & Production Cost III This video proves that externally imposing a cost curve to the kinked demand model is arbitrary.
091: Circular Location I This video proves that the so-called kinked demand model is arbitrary.
226: Networking I This video disproves the networking demand curve by Katz and Shapiro.

7. Price War

116: G&P Competition I This video proves that the Green & Porter competition is short-sighted.
117: G&P Competition II This video proves that the Green & Porter competition is too naive.
104: Hotelling & Cournot I This video proves that, contrary to Cournot’s theory, a competitor will not stay on the opponent’s demand curve.
105: Hotelling & Cournot II This video proves that, contrary to Cournot’s theory, competition does not lead to erratic prices.
106: Hotelling & Cournot III This video shows that reduction is not the only strategy in fighting the price war.
107: Hotelling & Cournot IV This video works out the duopoly price reaction functions.
113: Kinked Demand IV This video shows the third possible competition strategy: namely shifting the demand curve.

8. Competition in Reality

114: Stackelberg Competition I This video reduces the Cournot competition to a Stackelberg one.
115: Stackelberg Competition II This video combines the Cournot and the Stackelberg competition into a prisoner’s dilemma.
136: Game #7 This video shows that neither the Maximin nor the Nash method can solve the Prisoner’s dilemma of competition.
118: Final Competition This video integrates Cournot, Stackelberg and Hotelling Competition.
090: Location Choice VIII This video proves that the Hotelling’s demand curve is not a demand relation of consumers, but a pricing policy line of a firm.
356: Marginalism IX This video disproves the existence of monopoly demand.