Antoine Augustin Cournot | |
---|---|

Born | |

Died | 31 March 1877 75) | (aged

Nationality | French |

Alma mater | Sorbonne University |

Known for | Cournot competition Oligopoly |

Scientific career | |

Fields | Economics Mathematics |

Institutions | University of Grenoble |

Influences | Nicolas-François Canard |

Influenced | Gabriel Tarde Léon Walras |

**Antoine Augustin Cournot** (French pronunciation: [ɑ̃twan oɡystɛ̃ kuʁno] ; 28 August 1801 –31 March 1877) was a French philosopher and mathematician who also contributed to the development of economics.

Antoine Augustin Cournot was born at Gray, Haute-Saône. In 1821 he entered one of the most prestigious Grandes Écoles, the École Normale Supérieure, and, according to Sandmo:

in 1823 he took a license degree in mathematics at Sorbonne University. He then became the private secretary of a field marshal who required assistance in writing his memoirs. This position left Cournot with considerable time for his own pursuits. In the course of his ten years in the field marshal's employment he took two doctoral degrees, one in mechanics and one in astronomy. In addition, he published a number of articles and even acquired a degree in law.

^{ [1] }

Subsequently, Cournot held positions as professor of mathematics, chief examiner for undergraduate students, and rector of Dijon Academy.

By the time Cournot died in 1877, he was nearly blind.

Cournot was mainly a mathematician, but had some influence in economics. His theories on monopolies and duopolies are still prevalent.^{ [2] } In 1838 the book *Researches on Mathematical Principles of the Theory of Wealth*^{ [3] } was published, in which he used the application of the formulas and symbols of mathematics in economic analysis. This book was strongly criticized and scarcely successful during Cournot's lifetime. He attempted nonetheless to rewrite it twice. It is influential in economics today. Today many economists believe this book to be the point of departure for modern economic analysis^{[ citation needed ]}. Cournot introduced the ideas of functions and probability into economic analysis^{[ according to whom? ]}. He derived the first formula for the rule of supply and demand as a function of price and in fact was the first to draw supply and demand curves on a graph ^{[ according to whom? ]}, anticipating the work of Alfred Marshall by roughly thirty years. The Cournot duopoly model developed in his book also introduced the concept of a (pure strategy) Nash equilibrium, the reaction function and best-response dynamics.

Cournot believed that economists must utilize the tools of mathematics only to establish probable limits and to express less stable facts in more absolute terms. He further held that the practical uses of mathematics in economics do not necessarily involve strict numerical precision.^{[ citation needed ]}

In the field of economics he is best known for his work in the field of oligopoly theory, Cournot competition, which is named after him.^{ [4] }

Cournot worked on determinism (in physics) and chance.

Unlike Pierre-Simon de Laplace, who thought that nothing happens by chance, and Aristotle, who thought that randomness and causality had nothing to do which each other, Cournot united the concepts, defining randomness as the encounter of two independent causal series.^{ [5] } This definition allows randomness even in perfectly deterministic events, and is used to generate random numbers by the combination of unrelated signals (for instance, temperature and sound).

A **duopoly** is a type of oligopoly where two firms have dominant or exclusive control over a market. It is the most commonly studied form of oligopoly due to its simplicity. Duopolies sell to consumers in a competitive market where the choice of an individual consumer can not affect the firm. The defining characteristic of both duopolies and oligopolies is that decisions made by sellers are dependent on each other.

**Game theory** is the study of mathematical models of strategic interactions among rational agents. It has applications in all fields of social science, as well as in logic, systems science and computer science. Originally, it addressed two-person zero-sum games, in which each participant's gains or losses are exactly balanced by those of other participants. In the 21st century, game theory applies to a wide range of behavioral relations; it is now an umbrella term for the science of logical decision making in humans, animals, as well as computers.

**Microeconomics** is a branch of mainstream economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms. Microeconomics focuses on the study of individual markets, sectors, or industries as opposed to the national economy as whole, which is studied in macroeconomics.

An **oligopoly** is a market structure in which a market or industry is dominated by a small number of large sellers or producers. Oligopolies often result from the desire to maximize profits, which can lead to collusion between companies. This reduces competition, increases prices for consumers, and lowers wages for employees.

In microeconomics, **supply and demand** is an economic model of price determination in a market. It postulates that, holding all else equal, in a competitive market, the unit price for a particular good, or other traded item such as labor or liquid financial assets, will vary until it settles at a point where the quantity demanded will equal the quantity supplied, resulting in an economic equilibrium for price and quantity transacted. The concept of supply and demand forms the theoretical basis of modern economics.

This aims to be a complete article **list of economics topics**:

The following outline is provided as an overview of and topical guide to industrial organization:

**Joseph Louis François Bertrand** was a French mathematician who worked in the fields of number theory, differential geometry, probability theory, economics and thermodynamics.

**Bertrand competition** is a model of competition used in economics, named after Joseph Louis François Bertrand (1822–1900). It describes interactions among firms (sellers) that set prices and their customers (buyers) that choose quantities at the prices set. The model was formulated in 1883 by Bertrand in a review of Antoine Augustin Cournot's book *Recherches sur les Principes Mathématiques de la Théorie des Richesses* (1838) in which Cournot had put forward the Cournot model. Cournot's model argued that each firm should maximise its profit by selecting a quantity level and then adjusting price level to sell that quantity. The outcome of the model equilibrium involved firms pricing above marginal cost; hence, the competitive price. In his review, Bertrand argued that each firm should instead maximise its profits by selecting a price level that undercuts its competitors' prices, when their prices exceed marginal cost. The model was not formalized by Bertrand; however, the idea was developed into a mathematical model by Francis Ysidro Edgeworth in 1889.

**Cournot competition** is an economic model used to describe an industry structure in which companies compete on the amount of output they will produce, which they decide on independently of each other and at the same time. It is named after Antoine Augustin Cournot (1801–1877) who was inspired by observing competition in a spring water duopoly. It has the following features:

**Market structure**, in economics, depicts how firms are differentiated and categorised based on the types of goods they sell (homogeneous/heterogeneous) and how their operations are affected by external factors and elements. Market structure makes it easier to understand the characteristics of diverse markets.

**Jean Tirole** is a French professor of economics at Toulouse 1 Capitole University. He focuses on industrial organization, game theory, banking and finance, and economics and psychology. In 2014 he was awarded the Nobel Memorial Prize in Economic Sciences for his analysis of market power and regulation.

**Edward Hastings Chamberlin** was an American economist. He was born in La Conner, Washington, and died in Cambridge, Massachusetts.

**Stephen W. Salant** is an economist who has done extensive research in applied microeconomics. His 1975 model of speculative attacks in the gold market was adapted by Paul Krugman and others to explain speculative attacks in foreign exchange markets. Hundreds of journal articles and books on financial speculative attacks followed.

**Mathematical economics** is the application of mathematical methods to represent theories and analyze problems in economics. Often, these applied methods are beyond simple geometry, and may include differential and integral calculus, difference and differential equations, matrix algebra, mathematical programming, or other computational methods. Proponents of this approach claim that it allows the formulation of theoretical relationships with rigor, generality, and simplicity.

**Griffith Conrad Evans** was a mathematician working for much of his career at the University of California, Berkeley. He is largely credited with elevating Berkeley's mathematics department to a top-tier research department, having recruited many notable mathematicians in the 1930s and 1940s.

In oligopoly theory, **conjectural variation** is the belief that one firm has an idea about the way its competitors may react if it varies its output or price. The firm forms a conjecture about the variation in the other firm's output that will accompany any change in its own output. For example, in the classic Cournot model of oligopoly, it is assumed that each firm treats the output of the other firms as given when it chooses its output. This is sometimes called the "Nash conjecture," as it underlies the standard Nash equilibrium concept. However, alternative assumptions can be made. Suppose you have two firms producing the same good, so that the industry price is determined by the combined output of the two firms. Now suppose that each firm has what is called the "Bertrand Conjecture" of −1. This means that if firm A increases its output, it conjectures that firm B will reduce its output to exactly offset firm A's increase, so that total output and hence price remains unchanged. With the Bertrand Conjecture, the firms act as if they believe that the market price is unaffected by their own output, because each firm believes that the other firm will adjust its output so that total output will be constant. At the other extreme is the Joint-Profit maximizing conjecture of +1. In this case, each firm believes that the other will imitate exactly any change in output it makes, which leads to the firms behaving like a single monopoly supplier.

**Andreu Mas-Colell** is an economist, an expert in microeconomics and a prominent mathematical economist. He is the founder of the Barcelona Graduate School of Economics and a professor in the department of economics at Pompeu Fabra University in Barcelona, Catalonia, Spain. He has also served several times in the cabinet of the Catalan government. Summarizing his and others' research in general equilibrium theory, his monograph gave a thorough exposition of research using differential topology. His textbook on microeconomics, co-authored with Michael Whinston and Jerry Green, is the most used graduate microeconomics textbook in the world.

**Xavier Vives** is a Spanish economist regarded as one of the main figures in the field of industrial organization and, more broadly, microeconomics. He is currently Chaired Professor of Regulation, Competition and Public Policies, and academic director of the Public-Private Sector Research Center at IESE Business School in Barcelona.

Microeconomics is the study of the behaviour of individuals and small impacting organisations in making decisions on the allocation of limited resources. The modern field of **microeconomics** arose as an effort of neoclassical economics school of thought to put economic ideas into mathematical mode.

- ↑ Sandmo, Agnar (2011).
*Economics evolving*. Princeton: Princeton university press. p. 146. ISBN 9780691148427. - ↑ Koutsoyiannis, A. (1979), Koutsoyiannis, A. (ed.), "Non-Collusive Oligopoly",
*Modern Microeconomics*, London: Macmillan Education UK, pp. 215–236, doi:10.1007/978-1-349-16077-8_9, ISBN 978-1-349-16077-8 , retrieved 2 March 2022 - ↑ Antoine Augustin Cournot (1897).
*Researches into the Mathematical Principles of the Theory of Wealth*. Macmillan. - ↑ Varian, Hal R. (2006) [Originally published 1987].
*Intermediate Microeconomics: A Modern Approach*(Seventh ed.). W. W. Norton & Company. p. 490. ISBN 0393927024. - ↑ Thierry Martin. "Cournot (A)".
*encyclo-philo.fr*(in French). Retrieved 16 January 2017..

- Touffut, Jean-Philippe, ed. (2007).
*Augustin Cournot: Modelling Economics*. Cheltenham: Edward Elgar. ISBN 978-1-84720-654-1. - For an early 20th century evaluation see: Chisholm, Hugh, ed. (1911).
*Encyclopædia Britannica*. Vol. 7 (11th ed.). Cambridge University Press. p. 321. .

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