Abstract
In the presence of network externalities, we compare the stability of collusion under Bertrand and Cournot duopoly with differentiated products. Contrast to previous studies, we show that (i) firms have stronger incentive to collude under Bertrand competition than under Cournot competition in the sense of wide range of network externalities; (ii) collusion in prices (quantities) is more stable than in quantities (prices) if network externalities is strong (weak).
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