Group for Research in Decision Analysis


Time evolution of a differentiated oligopoly: The case of sustainable wine


We study the time evolution of a vertically and horizontally differentiated oligopolistic industry, where firms compete in quantity and are divided into groups producing one variety of a substitutable product. We assume that firms can periodically revise their decision about which variety to produce. For a general oligopoly with two varieties, we characterize the industry composition in the steady state as a function of the parameter values. Our results are applied to the case of the sustainable wine industry.

, 32 pages