On the dynamics of economic games based on product differentiation

Andaluz, Joaquı́n; Jarne, Gloria

doi:10.1016/j.matcom.2015.02.005

Cited by 28 publications

(26 citation statements)

References 7 publications

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“…Chen and Liu pointed out that greater degree of product differentiation can bring higher profits to the manufacturers who dominate the game in the dual-channel supply chain [15]. Andaluz and Jarne defined a demand model about differentiated products and found that if the complementary products and substituted products exist, the stability of Nash equilibrium will improve with the increase of the product independence [16].…”

Section: Literature Reviewmentioning

confidence: 99%

Strategic Customer Behavior and Pricing Strategy Based on the Horizontal Differentiation of Products

Zhao

Yue

et al. 2020

Mathematical Problems in Engineering

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Manufacturers produce products with horizontal differences to meet different needs of customers. This paper compares the influence of three different sales channels on strategic customers’ choice and the pricing strategy of products with horizontal differentiation. The results show that the strategic customers whose willingness to pay (WTP) is close to 1 will buy high-performance products and whose WTP is close to 0 will not purchase any kind of products in the two dual-channel models. If the manufacturers adopt dual channel to sell products with horizontal differences, the retailers agree that the manufacturers sell high-performance products in the traditional channel and sell low-performance products in the electronic channel. In dual-channel supply chain model I, the higher the satisfaction of high-performance products and the lower the satisfaction of low-performance products, the more conducive to the retailers.

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Section: Literature Reviewmentioning

confidence: 99%

Strategic Customer Behavior and Pricing Strategy Based on the Horizontal Differentiation of Products

Zhao

Yue

et al. 2020

Mathematical Problems in Engineering

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“…And hence, the economists and the mathematicians can simulate the complex dynamical behavior of oligopoly market by using computer technology. Recently, a large number of scholars have improved the oligopoly models, and introduced bounded rationality (see [2,3]), incomplete information [4], time delay [5], market entering and entering barriers [6], differentiated products [7] and other factors [8,9] into the classical oligopoly models, and the bifurcation and chaos phenomenon were founded in the process of repeated game.…”

Section: Introductionmentioning

confidence: 99%

Complex Dynamical Behavior of a Bounded Rational Duopoly Game with Consumer Surplus

Zhou¹,

Chu²

2020

Research Advances in Chaos Theory

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In this chapter, we assume that two bounded rational firms not only pursue profit maximization but also take consumer surplus into account, so the objections of all the firms are combination of their profits and the consumer surplus. And then a dynamical duopoly Cournot model with bounded rationality is established. The existence and stability of the boundary equilibrium points and the Nash equilibrium of the model are discussed, respectively. And then the stability condition of the Nash equilibrium is given. The complex dynamical behavior of the system varies with parameters in the parameter space is studied by using the so-called 2D bifurcation diagram. The coexistence of multiple attractors is discussed through analyzing basins of attraction. It is found that not only two attractors can coexist, but also three or even four attractors may coexist in the established model. Then, the topological structure of basins of attraction and the global dynamics of the system are discussed through invertible map, critical curve and transverse Lyapunov exponent. At last, the synchronization phenomenon of the built model is studied.

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“…Literature has included many works of such games whose dynamic behavior is very complex and includes important phenomena such as bifurcation and chaos. For instance, the differentiation of consumers between products has been introduced and investigated in [10]. Rationality and heterogeneous expectations that may arise in models of economy have been studied in [11] by Hommes. Expectations mean that the behaviors adopted by a firm may be naive, rational, or local approximation mechanism.…”

Section: Introductionmentioning

confidence: 99%

Analysis of a Four‐Firm Competition Based on a Generalized Bounded Rationality and Different Mechanisms

Askar

Al-khedhairi

2019

Complexity

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In this paper, the Caputo derivative with fractional orders is suggested to model a competition among four competing firms. The proposed economic model that describes this competition is constructed based on a generalization of the traditional bounded rationality. In this generalization, we study the influence of memory parameter on the complex behavior of the model. Memory means that we not only take into account the changes in quantities at a current time, but also study the changes occurring in the quantities during an interval of time. For simplicity, it is assumed that the degree of memory is described by one parameter during that interval. The properties of the proposed model such as stability of equilibria, bifurcation, and chaos are studied. Furthermore, we introduce and study the cooperation that may take place among the four firms using Keeney-Raiffa approach.

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On the dynamics of economic games based on product differentiation

Cited by 28 publications

References 7 publications

Strategic Customer Behavior and Pricing Strategy Based on the Horizontal Differentiation of Products

Strategic Customer Behavior and Pricing Strategy Based on the Horizontal Differentiation of Products

Complex Dynamical Behavior of a Bounded Rational Duopoly Game with Consumer Surplus

Analysis of a Four‐Firm Competition Based on a Generalized Bounded Rationality and Different Mechanisms

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