Product Differentiation in a Bertrand-Edgeworth Duopoly

Abstract In a Bertrand–Edgeworth model with homogeneous goods an equilibrium in pure strategies does not exist. Non-existence of a pure strategy equilibrium is not solely due to the homogeneous goods assumption. In this paper I consider a Bertrand–Edgeworth model with product differentiation and I parametrize when an equilibrium exists.Journal of Economic LiteratureClassification Numbers: D4, L1.