Games with switching costs and endogenous references

Name: Games with switching costs and endogenous references
Author: Güney, Begüm, Richter, M.

İsim	Games with switching costs and endogenous references
Yazar	Güney, Begüm, Richter, M.
Basım Tarihi:	2022-05-25
Basım Yeri	- Wiley
Konu	C72, Choice, D00, D01, D03, Endogenous reference, Epsilon equilibrium, Switching cost Nash equilibrium, Switching costs
Tür	Süreli Yayın
Dil	İngilizce
Dijital	Evet
Yazma	Hayır
Kütüphane:	Özyeğin Üniversitesi
Demirbaş Numarası	1933-6837
Kayıt Numarası	9ec71535-af3d-4a2e-ac8c-23a9b90b72de
Lokasyon	Economics
Tarih	2022-05-25
Örnek Metin	We introduce a game-theoretic model with switching costs and endogenous references. An agent endogenizes his reference strategy, and then taking switching costs into account, he selects a strategy from which there is no profitable deviation. We axiomatically characterize this selection procedure in one-player games. We then extend this procedure to multiplayer simultaneous games by defining a Switching Cost Nash Equilibrium (SNE) notion, and prove that (i) an SNE always exists; (ii) there are sets of SNE, which can never be a set of Nash equilibrium for any standard game; and (iii) SNE with a specific cost structure exactly characterizes the Nash equilibrium of nearby games, in contrast to Radner's (1980) ε-equilibrium. Subsequently, we apply our SNE notion to a product differentiation model, and reach the opposite conclusion of Radner (1980): switching costs for firms may benefit consumers. Finally, we compare our model with others, especially Köszegi and Rabin's (2006) personal equilibrium.
DOI	10.3982/TE4169
Cilt	17

Kaynağa git Özyeğin Üniversitesi

Aramaya Dön

Özyeğin Üniversitesi

Kaynağa git

Games with switching costs and endogenous references

Yazar Güney, Begüm, Richter, M.

Basım Tarihi 2022-05-25

Basım Yeri - Wiley

Konu C72, Choice, D00, D01, D03, Endogenous reference, Epsilon equilibrium, Switching cost Nash equilibrium, Switching costs

Tür Süreli Yayın

Dil İngilizce

Dijital Evet

Yazma Hayır

Kütüphane Özyeğin Üniversitesi

Demirbaş Numarası 1933-6837

Kayıt Numarası 9ec71535-af3d-4a2e-ac8c-23a9b90b72de

Lokasyon Economics

Tarih 2022-05-25

Örnek Metin We introduce a game-theoretic model with switching costs and endogenous references. An agent endogenizes his reference strategy, and then taking switching costs into account, he selects a strategy from which there is no profitable deviation. We axiomatically characterize this selection procedure in one-player games. We then extend this procedure to multiplayer simultaneous games by defining a Switching Cost Nash Equilibrium (SNE) notion, and prove that (i) an SNE always exists; (ii) there are sets of SNE, which can never be a set of Nash equilibrium for any standard game; and (iii) SNE with a specific cost structure exactly characterizes the Nash equilibrium of nearby games, in contrast to Radner's (1980) ε-equilibrium. Subsequently, we apply our SNE notion to a product differentiation model, and reach the opposite conclusion of Radner (1980): switching costs for firms may benefit consumers. Finally, we compare our model with others, especially Köszegi and Rabin's (2006) personal equilibrium.

DOI 10.3982/TE4169

Cilt 17