A complete characterization of equilibria in asymmetric Bertrand games
Abstract
This paper provides a complete characterization of equilibria – i.e. characterizes all Nash equilibria – in asymmetric Bertrand duopoly competition with general monopoly profit functions. When monopoly profits are finite, in all equilibria the low-cost firm serves the entire market and earns positive profits, while the high-cost firm randomizes over prices and earns zero profits. With unbounded monopoly profits, a continuum of equilibria may exist in which both firms employ mixed strategies and earn positive profits.
Fields of Study & Subjects
Game Theory and Applications
Mathematical and Theoretical Epidemiology and Ecology Models
Quantum chaos and dynamical systems
Publication details
- Journal / source
- Applied Economics Letters
- Pages
- 1–9
- Publication date
- 5 January 2026
- Language
- EN