Strategies of firms behavior on heat market Cover Image

Strategie zachowań przedsiębiorstw na rynku ciepła
Strategies of firms behavior on heat market

Author(s): Edyta Ropuszańska-Surma, Magdalena Węglarz
Subject(s): Economy
Published by: Wydawnictwo Uniwersytetu Ekonomicznego we Wrocławiu
Keywords: heat market; strategic deterrence; game theory; player’s strategies

Summary/Abstract: The paper presents a model of local heat market, which has monopolistic structure, as well as an analysis of monopolist’s behavior in case of new player’s entrance on the market. The decision problem was shown from the perspective of the activities undertaken by the monopolist to scare potential competitors off. For this aim the game theory was used, namely the game of two players with non-zero-sum. The analysis was conducted according to the Cournot’s model, where players’ strategy is a production volume, in this case the quantity of heat production. There were estimated average cost curves for two firms, which was necessary to define purpose function. The average cost curves were modelled on the basis of the research which was conducted in the power heat company. The obtained results of the research are presented as the summary of this article, which is a proposal of the strategies for the two enterprises.

  • Issue Year: 2012
  • Issue No: 38
  • Page Range: 145-156
  • Page Count: 12
  • Language: Polish