In this paper we consider a Cournot–Bertrand duopoly model with linear demand and cost functions and with product differentiation. We propose a dynamic framework for the study of the stability properties of this kind of mixed oligopoly game, a rather neglected topic in the existing literature despite its relevance. In particular, in this paper we highlight the role of best response dynamics and of an adaptive adjustment mechanism for the stability of the equilibrium.
- Bounded rationality
- Mixed duopoly