Prominence and Search Regret in Duopoly

Evangelos Rouskas ()
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Evangelos Rouskas: Agricultural University of Athens

A chapter in Business Intelligence and Modelling, 2021, pp 93-98 from Springer

Abstract: Abstract I examine numerically the robustness of the uniqueness of the Burdett–Judd-type dispersed price equilibrium within the search regret disutility framework proposed by concurrent research (Rouskas, 2020, “Equilibrium Price Dispersion with Search Regret Disutility”, Studies in Microeconomics). To this end, I focus on a duopoly where (a) there exists two-type consumer heterogeneity with regard to search costs; (b) one seller is prominent in the sense that all consumers with positive search costs who search once observe the price of this seller with probability one; and (c) consumers with positive search costs experience search regret disutility. In this environment, the aforementioned uniqueness result reappears, i.e., adding seller prominence to the search regret disutility framework does not affect the uniqueness of the Burdett–Judd-type dispersed price equilibrium.

Keywords: Search costs; Prominence; Nonsequential search; Search regret disutility (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-030-57065-1_8

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DOI: 10.1007/978-3-030-57065-1_8

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