Total quantity being produced is less than would be produced under
perfect competition, but more than would be produced under monopoly.
Consequently, prices are going to go the other way and consequently
prices are going to be highest under monopoly, lowest on the
competition, and somewhere in between in this Cournot situation. So from
the point of view of the producers, this Cournot Equilibrium is worse
than monopoly, but better than perfect competition. And from the point
of view of the rest of us, the consumers, this Cournot quantity is worse
than perfect competition but better than monopoly. The only rider on
that being, if they're producing Coca-Cola and you have any kind of
concern for your teeth, maybe you shouldn't produce so much anyway. So,
so far what we've done is we've looked at this sort of classical, I
admit not the most exciting game in the world, but classic application
of Game Theory to imperfect competition.
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李小梁Jadon Lee
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