Resumen de An evolutionary model of bertrand oligopoly

Carlos Alós Ferrer, Ana B. Ania Martínez, Klaus R. Schenk Hoppé

• We analyze the long-run outcome of markets in which boundedly rational firms with a decreasing returns to scale technology compete in prices. The behavior of these firms is based on limitation of success and experimentation. In this framework, we introduce a new approach to model boundedly rational behavior, based on the idea of behavioral principles, i.e. formal descriptions. Even with the simplest ones, the result is that the prices announced are a strict refinement of the set of Nash equilibria. With more sophisticated behavioral principles, the long-run outcome corresponds to the concept of central prices (wich are also Nash equilibria) introduced here. This is a robust and clear-cut prediction wich, under quadratic costs and arbitrary demand, essentially coincides with the Walrasian equilibrium.