Consumer Search, Rationing Rules, and the Consequences for Competition

Christopher S. Ruebeck, Lafayette College

Social Computing, Behavioral Modeling, and Prediction
Lecture Notes in Computer Science, 6589: edited by J. Salerno, S.J. Yang, S.-K. Chai
April 2011editorial proof


Firms’ conjectures about demand are consequential in oligopoly games. Through agent-based modeling of consumers’ search for products, we can study the rationing of demand between capacity-constrained firms offering homogeneous products and explore the robustness of analytically solvable models’ results. After algorithmically formalizing short-run search behavior rather than assuming a long-run average, this study predicts stronger competition in a two-stage capacity-price game.

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