Hamid Nazerzadeh
ABSTRACT
We study a duopoly setting that consists of two capacity-constrained sellers and a single buyer. The capacity of each seller is her private information. The sellers simultaneously offer menus of quantity-price contracts to the buyer. Then the buyer chooses a set of contracts to maximize his own utility. We show that under certain natural conditions there exists a pure strategy equilibrium for the sellers which defines an efficient allocation. We study the effects of asymmetry of information, using the full information setting as a benchmark. We show that the revenue is higher when the capacities obtained by the sellers are private information.
- Itai Ashlagi, Dov Monderer, and Moshe Tennenholtz. Simultaneous ad auction. Mathematics of Operations Research, 2011. Google Scholar
Digital Library
- Douglas Bernheim and Michael Whinston. Common agency. Econometrica, 54 (4): 923--42, July 1986.Google ScholarCross Ref
- Gérard Cachon and Gürhan Kök. Competing manufacturers in a retail supply chain: on contractual form and coordination. Management Science, 56 (3): 571--589, 2010. Google ScholarDigital Library
- Giacomo Calzolari and Carlo Scarpa. Delegated and intrinsic common agency with full market participation. Working Paper, 2008.Google Scholar
- Jon Feldman, Vahab S. Mirrokni, S. Muthukrishnan, and Mallesh M. Pai. Auctions with intermediaries: extended abstract. In Proceedings of 11th ACM Conference on Electronic Commerce (EC), pages 23--32, 2010. Google ScholarDigital Library
- Esther Gal-Or. Information transmission -- Cournot and Bertrand equilibria. Review of Economic Studies, 53 (1): 85--92, January 1986.Google ScholarCross Ref
- Sanford J Grossman. Nash equilibrium and the industrial organization of markets with large fixed costs. Econometrica, 49 (5): 1149--72, September 1981.Google ScholarCross Ref
- Oliver Hart. Imperfect competition in general equilibrium: An overview of recent work. Frontiers of Economics, edited by K. Arrow and S. Honkapohja, 1985.Google Scholar
- Paul D Klemperer and Margaret A Meyer. Supply function equilibria in oligopoly under uncertainty. Econometrica, 57 (6): 1243--77, November 1989.Google ScholarCross Ref
- Didier Laussel and Michel Le Breton. Conflict and Cooperation: The structure of equilibrium payoffs in common agency. Journal of Economic Theory, 100 (1): 93--128, September 2001.Google ScholarCross Ref
- David Martimort and Humberto Moreira. Common agency and public good provision under asymmetric information. Theoretical Economics, 2009.Google Scholar
- David Martimort and Lars Stole. The revelation and delegation principles in common agency games. Econometrica, 70 (4): 1659--1674, 2002.Google ScholarCross Ref
- David Martimort and Lars Stole. Market participation in delegated and intrinsic common-agency games. RAND Journal of Economics, 40 (1): 78--102, 2009.Google ScholarCross Ref
- Eric Maskin and Jean Tirole. The principal-agent relationship with an informed principal: The case of private values. Econometrica, 58 (2): 379--409, March 1990.Google ScholarCross Ref
- Timothy McGuire and Richard Staelin. An industry equilibrium analysis of downstream vertical integration. Marketing Science, 2: 161--191, 1983.Google ScholarDigital Library
- Paul Milgrom and Ilya Segal. Envelope theorems for arbitrary choice sets. Econometrica, 70 (2): 583--601, 2002.Google ScholarCross Ref
- Roger Myerson. Optimal auction design. Mathematics of Operations Research, 1981.Google ScholarDigital Library
- Malles Pai. Competing auctioneers. Working pape, 2010.Google Scholar
- Daniel F Spulber. Bertrand competition when rivals' costs are unknown. Journal of Industrial Economics, 43 (1): 1--11, March 1995.Google ScholarCross Ref
- Xavier Vives. Strategic supply function competition with private information. Technical report, 2008.Google Scholar
Index Terms
- Menu pricing competition and a common agency with informed principals
Recommendations
Learning and Pricing with Models That Do Not Explicitly Incorporate Competition
In revenue management research and practice, demand models are used that describe how demand for a seller's products depends on the decisions, such as prices, of that seller. Even in settings where the demand for a seller's products also depends on ...
The role of market pricing mechanism under imperfect competition
This paper illustrates how a supplier profit may be affected by the market pricing mechanism under imperfect competition. A parameterized Supply Function Equilibrium (SFE) model involving manipulation of the sole intercept is used to represent the ...
Pricing commodities
How should a seller price her goods in a market where each buyer prefers a single good among his desired goods, and will buy the cheapest such good, as long as it is within his budget? We provide efficient algorithms that compute near-optimal prices for ...
Comments