A Hotelling-Type Network

• Type: Chapter or Part of a Book
• Date: 2011

Authors

Alberto A. Pinto (Author) FCUP; Telmo Parreira (Author) Other

Book

Title: Dynamics, Games and Science I, DYNA 2008, in Honor of Maurício Peixoto and David Rand. Springer Proceedings in Mathematics

1º Edition

Pages: 709-720

ISBN: 978-3-642-11455-7

Publisher: Springer

Scientific classification

FOS: Natural sciences > Mathematics

Other information

Resumo (PT): This paper develops a theoretical framework to study spatial price competition in a Hotelling-type network game. Each firm i is represented by a node of degree k i , where k i is the number of firm i’s direct competitors (neighbors). We investigate price competition á la Hotelling with complete and incomplete information about the network structure. The goal is to investigate the effects of the network structure and of the uncertainty on firms’ prices and profits. We first analyze the benchmark case where each firm knows its own degree as well as the rivals’ degree. Then, in order to understand the role of information in the price competition network, we also analyze the incomplete information case where each firm knows its type (i.e. number of connections) but not the competitors’ type.

Abstract (EN): This paper develops a theoretical framework to study spatial price competition in a Hotelling-type network game. Each firm i is represented by a node of degree k i , where k i is the number of firm i’s direct competitors (neighbors). We investigate price competition á la Hotelling with complete and incomplete information about the network structure. The goal is to investigate the effects of the network structure and of the uncertainty on firms’ prices and profits. We first analyze the benchmark case where each firm knows its own degree as well as the rivals’ degree. Then, in order to understand the role of information in the price competition network, we also analyze the incomplete information case where each firm knows its type (i.e. number of connections) but not the competitors’ type.

Language: English

Type (Professor's evaluation): Scientific