Complexity Analysis of Prefabrication Contractors’ Dynamic Price Competition in Mega Projects with Different Competition Strategies

Jianbo Zhu, Qianqian Shi, Peng Wu, Zhaohan Sheng and Xiangyu Wang

Complexity, 2018, vol. 2018, 1-9

Abstract:

This paper considers a repeated duopoly game of prefabrication contractors in mega infrastructure projects and assumes the contractors exhibit bounded rationality. Based on the theory of bifurcation of dynamical systems, a dynamic price competition model is constructed considering different competition strategies. Accordingly, the stability of the equilibrium point of the system is discussed considering different initial market capacities, and numerical simulation is performed. The results show the system has a unique equilibrium solution when initial capacity is high and the parameters meet certain conditions. The contractors’ price adjustment strategy has an important influence on system stability. However, an overly aggressive competition strategy is not conducive to system stability. Moreover, the system is sensitive to initial parameter values.

Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:hin:complx:5928235

DOI: 10.1155/2018/5928235

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