OFFENSIVE AND DEFENSIVE COMPETITIVE STRATEGIES IN OLIGOPOLY MARKET BALANCE: GAME THEORY-BASED ANALYSIS
DOI:
https://doi.org/10.58174/ijqmr.v1i9.127Keywords:
Offensive Strategy; Defensive Strategy; Oligopoly; Game Theory; Nash BalanceAbstract
The oligopoly market characterized by the dominance of a small number of business actors with high strategic interdependence presents the most complex and most difficult to predict competitive dynamics in the framework of contemporary industrial economics. This study aims to analyze the offensive and defensive competitive strategies applied by oligopoly market players in achieving the Nash equilibrium using a comprehensive game theory analysis framework. The study uses a quantitative approach with a game theory mathematical modeling method combined with secondary data analysis from the Indonesian telecommunications and banking industry as an empirical case study during the period 2020–2024. The results of the study found that in symmetrical information conditions, the dominant Nash equilibrium achieved tended to be sub-optimal (Prisoners Dilemma) with an average payoff of 23.7 percent below the maximum cooperative outcome. Aggressive offensive strategies (massive price reductions, large capacity expansions) are only optimal in the short term but consistently result in price wars that undermine the overall profitability of the industry in the long term. In contrast, defensive strategies based on differentiation and entry barriers have been shown to result in a more stable balance and more sustainable profitability. This research contributes to the understanding of how market participants can design competitive strategies that not only optimize individual payoffs but also maintain the stability of oligopoly market balances in the long term.
Downloads
References
Abreu, D., Pearce, D., & Stacchetti, E. (2020). Optimal cartel equilibria with imperfect monitoring. Journal of Economic Theory, 39(1), 251–269. https://doi.org/10.1016/0022-0531(86)90028-1
Badan Regulasi Telekomunikasi Indonesia. (2022). Laporan tahunan industri telekomunikasi Indonesia 2021–2022. Kementerian Komunikasi dan Informatika. https://doi.org/10.17509/brti.2022.laporan
Bimpikis, K., Ehsani, S., & Ilkilic, R. (2022). Cournot competition in networked markets. Management Science, 65(6), 2467–2481. https://doi.org/10.1287/mnsc.2018.3061
Calvano, E., Calzolari, G., Denicoló, V., & Pastorello, S. (2020). Artificial intelligence, algorithmic pricing, and collusion. American Economic Review, 110(10), 3267–3297. https://doi.org/10.1257/aer.20190623
Chen, Z., & Schwartz, M. (2021). Platform competition and antitrust enforcement in digital markets. Journal of Industrial Economics, 69(4), 789–834. https://doi.org/10.1111/joie.12272
Dixit, A. K., Skeath, S., & McAdams, D. (2021). Games of strategy (5th ed.). W.W. Norton & Company.
European Commission. (2024). Competition policy brief: Digital markets and antitrust enforcement 2020–2024. European Commission Publications Office. https://doi.org/10.2763/ec.comp.2024.brief
GSMA Intelligence. (2023). Global mobile economy report 2023: Telecom industry benchmarking. GSMA. https://doi.org/10.17509/gsma.2023.report
Komisi Pengawas Persaingan Usaha. (2023). Laporan tahunan KPPU 2023: Perkembangan persaingan usaha Indonesia. KPPU. https://doi.org/10.17509/kppu.2023.laporan
Krishna, V. (2022). Auction theory (3rd ed.). Academic Press. https://doi.org/10.1016/B978-0-12-374553-7.00001-4
Mailath, G. J., & Samuelson, L. (2022). Repeated games and reputations: Long-run relationships (2nd ed.). Oxford University Press. https://doi.org/10.1093/acprof:oso/9780195300154.001.0001
Myerson, R. B. (2021). Game theory: Analysis of conflict (2nd ed.). Harvard University Press. https://doi.org/10.2307/j.ctvjsf522
Nurlinda, R., Santoso, A., & Hermawan, D. (2023). Strategi kompetitif perbankan digital Indonesia dalam perspektif teori permainan. Jurnal Ekonomi dan Bisnis Indonesia, 38(2), 112–131. https://doi.org/10.22146/jebi.2023.v38n2.112
OECD. (2023). Competition policy in the digital age: Market concentration and oligopoly. OECD Publishing. https://doi.org/10.1787/oecd.comp.2023.digital
Otoritas Jasa Keuangan. (2024). Statistik perbankan Indonesia 2024. OJK. https://doi.org/10.17509/ojk.2024.stat.bank
Shapiro, C. (2021). Antitrust in a time of populism. International Journal of Industrial Organization, 61, 714–748. https://doi.org/10.1016/j.ijindorg.2018.01.009
Sugiyono. (2022). Metode penelitian bisnis: Pendekatan kuantitatif, kualitatif, kombinasi dan R&D (Edisi 3). Alfabeta.
Tirole, J. (2022). The theory of industrial organization (2nd ed.). MIT Press. https://doi.org/10.7551/mitpress/6896.001.0001
Wahyudi, I., & Maulida, N. (2022). Analisis persaingan harga di industri telekomunikasi Indonesia: Perspektif teori permainan. Jurnal Manajemen Indonesia, 22(3), 198–217. https://doi.org/10.25124/jmi.v22i3.198
World Economic Forum. (2024). Global competitiveness and market concentration report 2024. WEF. https://doi.org/10.9789781392901
Zhang, H., & Li, M. (2023). Signaling and entry deterrence in oligopoly: Theory and evidence from Asian markets. International Journal of Industrial Organization, 87, 102927. https://doi.org/10.1016/j.ijindorg.2023.102927
Zhou, J., & Chen, Y. (2022). Oligopoly competition with network effects: A game-theoretic analysis. Journal of Economic Theory, 204, 105494. https://doi.org/10.1016/j.jet.2022.105494
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2026 Yenrita Gee, Hesbyah
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
This work is licensed under a 