Forming an evolutionarily stable firm strategy under Cournot competition using social preferences

Abstract

The paper investigates what kinds of firms’ social preferences (egoists, altruists or punishers) prove to be evolutionarily stable strategies under Cournot competition in the market of homogeneous product. Combining the traditional and evolutionary approaches to competition we define the conditions that forecast the attitude and profit dynamics of competitors under Cournot competition and adaptive behavior of rivals.