In this paper, we consider a hierarchical oligopoly model, in which firms compete on quantities of an homogeneous product. We provide a proof and an interpretation that under the three necessary and sufficient conditions of linear aggregate demand, constant and identical marginal costs, the strategy of leaders at any stage depends neither on the number of leaders who play after nor on the number of remaining stages. So, all firms behave as Cournotian oligopolists on the residual demand. We show that these three assumptions are not only sufficient but also necessary. Any departure from any of these assumptions rules out this property
This article documents the disciplinary exchanges between economists and engineers at Stanford throughout the twentieth century. We outline the role of key scholars such as Kenneth Arrow and Robert Wilson, as well as engineers turned administrators like Frederick Terman. We show that engineers drew upon economic theories of decision and allocation to improve practical industrial management decisions. Reciprocally, economists found in engineering the tools that they needed to rethink production and growth theory (including linear programming, optimal control theory, an epistemology of “application” that emphasized awareness to institutional details, trials and errors and experiments). By the 2000s, they had turned into economic engineers designing markets and other allocation mechanisms. These cross-disciplinary exchanges were mediated by Stanford’s own institutional culture, notably its use of joint appointments, the development of multidisciplinary “programs” for students, the ability to attract a variety of visitors every year, the entrepreneurial and contract- oriented vision of its administrators, and the close ties with the industrial milieu that came to be called the Silicon Valley.
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