This is a portrait of the 19th-century French economist Augustin Cournot. The image provides a visual representation of the person whose pioneering work in applying mathematics to economic analysis, including his foundational models of oligopoly and monopoly, is detailed in related nodes.

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Augustin Cournot (1801–1877) was a 19th-century French economist who pioneered the use of mathematics in economic analysis. In his 1838 book, 'Recherches sur les Principes Mathématiques de la Théorie des Richesses,' he developed a foundational model of oligopoly and also analyzed monopoly pricing. A notable example from his work is the case of a mineral spring with unique properties, which he used to demonstrate that a monopolist selling a differentiated product would maximize profit by setting a price above the marginal cost of production. His work influenced later prominent economists like Marshall and Walras.

Augustin Cournot (1801–1877)

To cite the ebook, use The CORE Econ Team 2023 The Economy 2.0: Microeconomics Open access e-text https://core-econ.org/the-economy/.

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CORE Econ - The Economy 2.0: Microeconomics

The Cournot model is a theory of oligopoly in which firms compete on the quantity of output they produce. Each firm decides its production level simultaneously, assuming that the output of its competitors is fixed. The model predicts an equilibrium outcome where the total quantity produced is higher than in a monopoly but lower than in a perfectly competitive market, resulting in a price that is also between the monopoly and competitive levels.

Cournot Model of Oligopoly

The French economist Augustin Cournot, writing in the 19th century, provided a classic analysis of pricing for a differentiated product. He used the hypothetical example of bottled water from a mineral spring that was discovered to have 'salutary properties possessed by no other.' Cournot's analysis demonstrated that the owner of such a unique resource would maximize their profit by establishing a price that is higher than the marginal cost of production.

Monopoly from Control of a Unique Resource (Cournot's Mineral Spring)

Published in 1838, 'Recherches sur les Principes Mathématiques de la Théorie des Richesses' (Research on the Mathematical Principles of the Theory of Wealth) is a foundational text by Augustin Cournot. In this work, he pioneered the use of mathematical analysis in economics and developed key theories, including the model of monopoly pricing, which he illustrated with the well-known example of a unique mineral spring.

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