Product differentiation in a Bertrand-Edgeworth duopoly

In a Bertrand-Edgeworth model with homogeneous goods an equilibrium in pure strategies does not exist. Non-existence of a pure strategy equilibrium is not solely due to the homogeneous goods assumption. In this paper I consider a Bertrand-Edgeworth model with product differentiation and I parametrize when an equilibrium exists. Journal of Economic Literature Classification Numbers: D4, L1. (C) 1996 Academic Press, Inc.