Chapter 11
The Effect of Strategic Firm Objectives on Competition
Daniel Cracau
Abstract
I present a generalized form of firms’ objective function. Besides classical own profit maximization, I add two distinct concerns: consumer surplus and competitors’ profits. This generalization can account for public and partially privatized firms, socially concerned firms as well as partially cooperating firms. I study a simple duopoly game to compare and discuss the effects of both concerns on equilibrium outcomes.
Total Pages: 170-181 (12)
Purchase Chapter
Book Details