Consumer Search, Rationing Rules, and the Consequence for Competition

Abstract. Firms’ conjectures about demand are consequential in oligopoly games. Through agent-based modeling of consumers’ search for products, we can study the rationing of demand between capacity-constrained firms offering homogeneous products and explore the robustness of analytically solvable models’ results. After algorithmically formalizing short-run search behavior rather than assuming a long-run average, this study predicts stronger competition in a two-stage capacity-price game.

• Type: Journal
• Year: 2011
• Where: SBP
• Authors: Christopher S. Ruebeck
• Keywords: Applied Computing, Oligopoly Games, SBP 2011, Search Behavior, Solvable Models