Firms' timing of production with heterogeneous consumers.
I revisit endogenous timing in a quantity‐setting duopoly game. In the basic model, I show that given strong heterogeneity in consumers' willingness to pay (WTP) and a moderately small consumer segment with low WTP, sequential moving outcomes can appear in equilibrium with the follower enjoying seco...
| Publicado en: | Canadian Journal of Economics Vol. 51; no. 4; pp. 1339 - 1363 |
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| Formato: | Artículo |
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Wiley-Blackwell
Nov2018
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=132722118&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 132722118 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00084085 CJE jtl: Canadian Journal of Economics issn: 00084085 maglogo: Y pubinfo: dt: Nov2018 vid: 51 iid: 4 pid: 480 pub: Wiley-Blackwell artinfo: ui: 132722118 10.1111/caje.12360 ppf: 1339 ppct: 24 formats: tig: atl: Firms' timing of production with heterogeneous consumers. aug: au: Pan, Cong affil: Business School, Nagoya University of Commerce and Business su: Consumer behavior Production (Economic theory) Economic equilibrium Economic competition Willingness to pay Pricing sug: subj: Consumer behavior Production (Economic theory) Economic equilibrium Economic competition Willingness to pay Pricing ab: I revisit endogenous timing in a quantity‐setting duopoly game. In the basic model, I show that given strong heterogeneity in consumers' willingness to pay (WTP) and a moderately small consumer segment with low WTP, sequential moving outcomes can appear in equilibrium with the follower enjoying second‐mover advantage. Owing to consumer heterogeneity in WTP, there is a local property that a firm's aggressive behaviour may lead to a competitor responding more aggressively. Hence, the sequential moves can restrict firms' total outputs to avoid a price collapse, and result in firms' strategic choices that Pareto dominate those under the simultaneous move. I further generalize my results and show that although firms compete in quantity, under some conditions of the demand function, features of strategic complements can appear. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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