Resource title

Searching for Markov perfect equilibria in oligopolistic price wars

Resource image

image for OpenScout resource :: Searching for Markov perfect equilibria in oligopolistic price wars

Resource description

Using empirical market data from brand rivalry in a retail ground-coffee market, the authors model each brand's pricing behavior using the Markov restriction, that marketing strategies depend only on profit-relevant state variables, and use a technique from machine learning to search for co-evolved Markov perfect equilibria, where each profit-maximizing brand manager is a stimulus-response automaton, responding to past prices in the oligopolistic market. Just what partitions are sufficient payoff-relevant? Part of work in progress on modeling economic actors' perceptions and choice of actions

Resource author

Resource publisher

Resource publish date

Resource language

en

Resource content type

application/pdf

Resource resource URL

http://flora.insead.edu/fichiersti_wp/inseadwp2000/2000-65.pdf

Resource license

Copyright INSEAD. All rights reserved