Arbeitspapier

Evolution of competitive equilibrium with endogenous product differentiation

Previous theoretical researches show that learning from good performers yields intense competition and results in the low profitability of firms. These researchers do not take into account differentiation strategies being referred as a useful strategic tool to mitigate competition. We introduce an evolutionary (learning) game into a duopoly model with product differentiation on the Hotelling line. We find that central agglomeration appears in the unique stochastically stable state in which the equilibrium price is equal to the marginal cost of firms. This implies that perfectly competitive equilibrium appears even when firms have an opportunity to differentiate themselves through product differentiation and to mitigate competition.

Sprache
Englisch

Erschienen in
Series: ISER Discussion Paper ; No. 776

Klassifikation
Wirtschaft
Stochastic and Dynamic Games; Evolutionary Games; Repeated Games
Market Structure, Pricing, and Design: Perfect Competition
Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection
Other Spatial Production and Pricing Analysis
Thema
product positioning
two dimensional choice
Walrasian
evolutionally stable
spatial agglomeration
Produktdifferenzierung
Verdrängungswettbewerb
Hotelling-Regel
Allgemeines Gleichgewicht
Evolutionäre Spieltheorie
Theorie

Ereignis
Geistige Schöpfung
(wer)
Matsumura, Toshihiro
Matsushima, Noriaki
Yamamori, Tetsuo
Ereignis
Veröffentlichung
(wer)
Osaka University, Institute of Social and Economic Research (ISER)
(wo)
Osaka
(wann)
2010

Handle
Letzte Aktualisierung
10.03.2025, 11:45 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
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Objekttyp

  • Arbeitspapier

Beteiligte

  • Matsumura, Toshihiro
  • Matsushima, Noriaki
  • Yamamori, Tetsuo
  • Osaka University, Institute of Social and Economic Research (ISER)

Entstanden

  • 2010

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