Economics

Two rival sellers guessing each other's output invented oligopoly theory

In 1838, Antoine Augustin Cournot modeled two mineral-water sellers who each pick a quantity assuming their rival's output stays fixed. Worked through repeatedly, both firms settle on a stable output above what a monopolist would produce but below the fully competitive level. It was the first mathematical model of competition between a few firms, decades before rival theories based on price.

Antoine Augustin Cournot, Recherches sur les Principes Mathématiques de la Théorie des Richesses — 1838

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