This paper analyzes the Nash equilibrium behavior of risk-averse oligopolistic firms under uncertain demand. It is shown that in the presence of unbiased forward markets the Nash Equilibrium (NE) output increases, that is, forward markets enhance competition. Unlike the competitive or monopoly...

We consider a model with a competitive risk-averse exporting firm who faces uncertain exchange rates in a multiperiod analysis. The capital stock (or fixed input) has to be determined at the outset while the variable input (labor) is chosen optimally at the beginning of each period, but before...

Recent empirical studies (see e.g. Kravis and Lipsev [1977, 1978], Isard [1977], Aspe and Giavazi [1982]) demonstrate that there are notable divergencies between domestic and export prices. This empirical evidence suggests that the law of one price is systematically violated. Kravis and Lipsey...