AN ADVERTISING OLIGOPOLY

Abstract

             Abstract: This paper proposes a model of advertising competition based on the Cournot oligopoly model using a dynamic system, the equilibrium points of which can be determined analytically. We consider several cases for explaining the way in which firms will adapt their own advertising volume, depending on the number and the advertising volume of their competitors, in the context of an online video game used for advertising purposes. The dynamic setup is given by online internet connection that allows interaction and communication and the high level of technology that permits nowadays real-time advertising insertions.