Product differentiation under bounded rationality

B. Vermeulen, J.A. Poutré, La, A.G. Kok, de, A. Pyka

Onderzoeksoutput: Hoofdstuk in Boek/Rapport/CongresprocedureConferentiebijdrageAcademicpeer review

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We study product differentiation equilibria and dynamics on the Salop circle under bounded rationality. Due to bounded rationality, firms tend to agglomerate in pairs. Upon adding a second tier of component suppliers, downstream assemblers may escape pairwise horizontal agglomeration. Moreover, we find a persistent propensity to vertically agglomerate near suppliers as well as ubiquitous dynamic equilibria. Conclusively, to understand product differentiation equilibria and dynamics, products and their supply chains need to be disaggregated.
Originele taal-2Engels
TitelProceedings of the 18th Asia Pacific Symposium on Intelligent and Evolutionary Systems
RedacteurenH. Handa, H. Ishibuchi, Y.-S. Ong, K.-C. Tan
Plaats van productieBerlin
StatusGepubliceerd - 2015

Publicatie series

NaamProceedings in Adaptation, Learning and Optimization
ISSN van geprinte versie2363-6084


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