Cobb-Douglas Preferences in Bilateral Oligopoly: Redefining Strategic Market Dynamics.
Bilateral oligopoly is a model where sellers and buyers exchange goods without fixed prices. The analysis shows that when traders have Cobb-Douglas preferences, the bids and supplies don't depend on each other. This means there is competition within each side of the market, but no strategic connection between sellers and buyers. The Cobb-Douglas assumption helps understand strategic trade, but misses some important aspects of bilateral oligopoly.