Cournot oligopolies with product differentiation under uncertainty

This paper considers Cournot oligopolies with product differentiation when the firms have inexact knowledge of the price functions and there are random time lags in obtaining and implementing information on the firms' own outputs and prices as well as on the prices of the competitors. After the basic dynamic model without time lag is formulated, the asymptotic stability in the linear case is examined. The introduction of time lags makes the asymptotic behaviour of the steady state more complex. A detailed stability analysis is undertaken. In the case of symmetric firms and with a special weighting function, the possibility of the birth of limit cycle motion in output is also investigated in addition to stability analysis.