Price dispersion in stationary networked markets

Talamàs, Eduard

doi:10.1016/j.geb.2019.03.005

Cited by 7 publications

(11 citation statements)

References 23 publications

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“…It holds, for example, if there is at least one active agent of each type in period t = 1, and q i n i −1 (0) = 0 for each type i. It also holds under the classical replica framework of the literature on non-cooperative bargaining in stationary markets (e.g., Rubinstein andWolinsky 1985 and1990;Gale 1987;de Fraja and Sákovics 2001, Manea 2011, Lauermann 2013, Nguyen 2015, Polanski and Vega-Redondo 2018, Talamàs 2019b) as long as there are two or more agents of each type.…”

Section: Stochastic Entrymentioning

confidence: 91%

“…First, this highlights that our mechanism does not rely on intertwining the investment and bargaining stages (as is the case in Che and Sákovics 2004, for example). Second, this substantially simplifies the analysis by allowing us to leverage existing results in the non-cooperative bargaining literature (e.g., Elliott andNava 2019 andTalamàs 2019b).…”

Section: Investmentmentioning

confidence: 99%

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No Holdup in Dynamic Markets

Elliott

Talamàs

2018

SSRN Journal

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In many markets, heterogenous agents make non-contractible investments before bargaining over both who matches with whom and the terms of trade. In static markets, the holdup problem-that is, inefficient investments caused by agents receiving only a fraction of their returns-is ubiquitous. Markets are often dynamic, however, with agents entering over time. Taking a general non-cooperative investment and bargaining approach, we show that the holdup problem vanishes in markets with dynamic entry as agents become patient: While there is substantial wiggle room for bargaining to determine outcomes, every bargaining outcome gives everyone her marginal product.

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Section: Stochastic Entrymentioning

confidence: 91%

Section: Investmentmentioning

confidence: 99%

No Holdup in Dynamic Markets

Elliott

Talamàs

2018

SSRN Journal

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“…, there exists an indifferent customer in interval [x 1 , x 2 ]. According to (3) and (6), equation (8) can be changed into…”

Section: Appendixmentioning

confidence: 99%

“…Since game theory was pioneered by John von Neumann in 1928 [1], it has been widely applied in politics, military strategy, economics, biology, computer science, and many other fields [2][3][4][5]. Meanwhile, the location game, as an important topic in the fields of industrial organization and transportation economics, has been attracting much attention from many researchers [6][7][8].…”

Section: Introductionmentioning

confidence: 99%

Location-Price Game in a Dual-Circle Market with Different Demand Levels

Chen

Song

Rong

et al. 2021

Mathematical Problems in Engineering

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This paper researches a location-price game in a dual-circle market system, where two circular markets are interconnected with different demand levels. Based on the Bertrand and Salop models, a double intersecting circle model is established for a dual-circle market system in which two players (firms) develop a spatial game under price competition. By a two-stage (location-then-price) structure and backward induction approach, the existence of price and location equilibrium outcomes is obtained for the location game. Furthermore, by Ferrari method for quartic equation, the location equilibrium is presented by algebraic expression, which directly reflects the relationship between the equilibrium position and the proportion factor of demand levels. Finally, an algorithm is designed to simulate the game process of two players in the dual-circle market and simulation results show that two players almost reach the equilibrium positions obtained by theory, wherever their initial positions are.

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“…Game theory, the science of strategy, was pioneered by John von Neumann when he proved the basic principles in 1928 [1]. As one of the main basic analysis tools for phenomena related to struggle or competition, game theory has been widely applied in politics, international relations, military strategy, biology, economics, computer science, and many other fields [2][3][4][5][6][7]. e location problem is an important topic in the fields of supply chain management and industrial organization.…”

Section: Introductionmentioning

confidence: 99%

Two-Player Location Game in a Closed-Loop Market with Quantity Competition

2020

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This paper considers the two-player location game in a closed-loop market with quantity competition. Based on the Cournot and Hotelling models, a circle model is established for a closed-loop market in which two players (firms) play a location game under quantity competition. Using a two-stage (location-then-quantity) pattern and backward induction method, the existence of subgame-perfect Nash equilibria is proved for the location game in the circle model with a minimum distance transportation cost function. In addition, sales strategies are proposed for the two players for every local market on the circle when the players are in the equilibrium positions. Finally, an algorithm for simulating the competitive dynamics of the closed-loop market is designed, and two numerical simulations are provided to substantiate the effectiveness of the obtained results.

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Price dispersion in stationary networked markets

Cited by 7 publications

References 23 publications

No Holdup in Dynamic Markets

No Holdup in Dynamic Markets

Location-Price Game in a Dual-Circle Market with Different Demand Levels

Two-Player Location Game in a Closed-Loop Market with Quantity Competition

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