Quantum approach to Bertrand duopoly

TL;DR

This paper explores quantum versions of the Bertrand duopoly game using two different quantum modeling approaches to identify Nash equilibria.

Contribution

It introduces two quantum models for the Bertrand duopoly, adapting existing schemes and simplifying with entangled states, to analyze strategic outcomes.

Findings

Identification of Nash equilibria in quantum Bertrand duopoly models

Comparison of quantum and classical strategic outcomes

Demonstration of quantum effects on duopoly competition

Abstract

The aim of the paper is to study the Bertrand duopoly example in the quantum domain. We use two ways to write the game in terms of quantum theory. The first one adapts the Li-Du-Massar scheme for the Cournot duopoly. The second one is a simplified model that exploits a two qubit entangled state. In both cases we focus on finding Nash equilibria in the resulting games.