External Economy and the Cournot Duoply or Stackelberg Games

In this paper we consider the output level of equilibrium in Cournot duopoly game with perfect information. It is known that there is first mover advantage in perfect information Cournot game with no external economy and total output level of the game equilibiria is smaller than it of Stackelberg game. But this is not true in Cournot or Stackelberg duopoly game with perfect information if there is external economy on one firm or both firms of duopoly firms. In this case, because of positive sloped reaction curve of the firm with external economy, Stackelberg equilibrium point locates on the left side or right side to Cournot equlibrium point. Therefore Stackelberg leader can or can not increase his production lebel from it of Cournot-Nash equilibria through the best reply curve