UCL Discovery
UCL home » Library Services » Electronic resources » UCL Discovery

Duopolistic Competition under Risk Aversion and Uncertainty

Chronopoulos, M; De Reyck, B; Siddiqui, AS; (2014) Duopolistic Competition under Risk Aversion and Uncertainty. European Journal of Operational Research , 236 (2) 643 - 656. 10.1016/j.ejor.2014.01.018. Green open access

[img]
Preview
PDF
1-s2.0-S0377221714000393-main.pdf

Download (1MB)

Abstract

A monopolist typically defers entry into an industry as both price uncertainty and the level of risk aversion increase. By contrast, the presence of a rival typically hastens entry under risk neutrality. Here, we examine these two opposing effects in a duopoly setting. We demonstrate that the value of a firm and its entry decision behave differently with risk aversion and uncertainty depending on the type of competition. Interestingly, if the leader’s role is defined endogenously, then higher uncertainty makes her relatively better off, whereas with the roles exogenously defined, the impact of uncertainty is ambiguous.

Type: Article
Title: Duopolistic Competition under Risk Aversion and Uncertainty
Open access status: An open access version is available from UCL Discovery
DOI: 10.1016/j.ejor.2014.01.018
Publisher version: http://dx.doi.org/10.1016/j.ejor.2014.01.018
Additional information: �© 2014 The Authors. Published by Elsevier B.V. All rights reserved. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
Keywords: Investment analysis; Real options; Competition; Risk aversion;
UCL classification: UCL
UCL > Provost and Vice Provost Offices
UCL > Provost and Vice Provost Offices > UCL BEAMS
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science > UCL School of Management
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Maths and Physical Sciences
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Maths and Physical Sciences > Dept of Statistical Science
URI: https://discovery.ucl.ac.uk/id/eprint/1417441
Downloads since deposit
177Downloads
Download activity - last month
Download activity - last 12 months
Downloads by country - last 12 months

Archive Staff Only

View Item View Item