A note on the existence of Nash equilibrium in the stochastic bottleneck model

Mogens Fosgerau () and Henning F. Jensen

MPRA Paper from University Library of Munich, Germany

Abstract: Consider Vickrey's dynamic bottleneck model of a congested facility. Let capacity be stochastic and assume that identical users minimize expected cost. This note shows that Nash equilibrium does not always exist. A counter-example is provided for the case of linear scheduling costs, where Nash equilibrium does not exist whenever the marginal cost of earliness is sufficiently low. Such a threshold exists for any absolutely continuous distribution of capacity.

Keywords: Bottleneck model; Random capacity; Nash equilibrium (search for similar items in EconPapers)
JEL-codes: R41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mic and nep-ure
Date: 2008
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