Nonlinear Dynamics, Psychology, and Life Sciences, Vol. 15, Iss. 4, October, 2011, pp. 513-532
@2011 Society for Chaos Theory in Psychology & Life Sciences


Is the Destabilization of the Cournot Equilibrium a Good Business Strategy in Cournot-Puu Duopoly?

Jose S. Canovas, Technical University of Cartagena,Spain

Abstract: It is generally acknowledged that the medium influences the way we communicate and negotiation research directs considerable attention to the impact of different electronic communication modes on the negotiation process and outcomes. Complexity theories offer models and methods that allow the investigation of how pattern and temporal sequences unfold over time in negotiation interactions. By focusing on the dynamic and interactive quality of negotiations as well as the information, choice, and uncertainty contained in the negotiation process, the complexity perspective addresses several issues of central interest in classical negotiation research. In the present study we compare the complexity of the negotiation communication process among synchronous and asynchronous negotiations (IM vs. e-mail) as well as an electronic negotiation support system including a decision support system (DSS). For this purpose, transcripts of 145 negotiations have been coded and analyzed with the Shannon entropy and the grammar complexity. Our results show that negotiating asynchronically via e-mail as well as including a DSS significantly reduces the complexity of the negotiation process. Furthermore, a reduction of the complexity increases the probability of reaching an agreement.

Keywords: duopoly, oligopoly, topological chaos, ergodic theory, invariant measures