Bertrand Competition | Microeconomics by Game Theory 101

[@hannahweber7585]

What about a case when firms aren't perfectly identical but have the same product and costs (like different geographical locations of gas stations) and a higher price does not guarantee no sale?

[@JMRG2992]

why i cannot find anywhere a video showing different demands, different prices. context. Maximization of each firms, no examples of this nowhere. it's almost incredible.

[@HN-bv7li]

no because it is assumption of bertrand competition. Homogeneous goods and symmetric prices.

[@Markd315]

I can think of one way (re end of video): Product differentiation

[@PunmasterSTP]

Bertrand? More like "Bro, thanks so much for helping us understand!"

[@hellojello3515]

It looks like you've made a mistake. Pd-C does not measure firms profit at the Pd price. To measure profit you need to know the quantity which it will be able to sell at Pd (Q at Pd, or Q(Pd)), which is the whole market demand at that price. So, the expession should look something like this: Q(PD)*(Pd-C) > A*(Q(P1)*(P1-C)), Or am I missing something?

[@lolaritter7518]

It’s like a race to the bottom

[@revimfadli4666]

Very reminiscent of Vickrey auction

[@DA0705]

thanks a lot, it really helps me to understant it

[@starrychloe]

The solution is marketing. If companies can make you feel better about their brand, you'll be more likely to pick them, even if they are a commodity product like fast food burgers or cell phone service or gasoline.

[@mdjuhaeradittya]

Thanks a lot

[@revimfadli4666]

Sounds like collusion between p1 and p2 could ensure either one gets a profit

[@erinagro8741]

where is the next video in this series?

[@Gametheory101]

This is the playlist: kzbin.info/aero/PLKI1h_nAkaQppKwAw3BuwMwe0IvmZ5oei