Nonsequential Search Equilibrium with Search Cost Heterogeneity

Jose Moraga-Gonzalez, Zsolt Sandor and Matthijs Wildenbeest
Additional contact information
Zsolt Sandor: Universidad Carlos III de Madrid

No 2010-11, Working Papers from Indiana University, Kelley School of Business, Department of Business Economics and Public Policy

Abstract: We generalize the model of Burdett and Judd (1983) to the case where an arbitrary finite number of firms sells a homogeneous good to buyers who have heterogeneous search costs. We show that a price dispersed symmetric Nash equilibrium always exists. Numerical results show that the behavior of prices with respect to the number of firms hinges upon the shape of the search cost distribution: when search costs are relatively concentrated (dispersed), entry of firms leads to higher (lower) average prices.

Keywords: nonsequential search; oligopoly; arbitrary search cost distributions (search for similar items in EconPapers)
JEL-codes: C72 D43 L13 (search for similar items in EconPapers)
Date: 2010-06
New Economics Papers: this item is included in nep-cmp and nep-com
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Citations: View citations in EconPapers (5)

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http://kelley.iu.edu/riharbau/RePEc/iuk/wpaper/bep ... ndor-wildenbeest.pdf (application/pdf)

Related works:
Journal Article: Nonsequential search equilibrium with search cost heterogeneity (2017)
Working Paper: Nonsequential search equilibrium with search cost heterogeneity (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:iuk:wpaper:2010-11

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