This paper considers price competition among firms when there are capacity constraints and buyers have limited ability to visit firms. A natural method of allocating buyers among firms arises in the equilibrium of the buyers' search game. Sufficient conditions are given under which the buyers' equilibrium varies continuously with the prices charged by firms. Capacity constraints are used to guarantee that this ensures existence of (mixed strategy) equilibria for the pricing game played by sellers. We show that natural pure strategy equilibria arise when the game is made large in appropriate ways.
MLA
Peters, Michael. “Bertrand Equilibrium with Capacity Constraints and Restricted Mobility.” Econometrica, vol. 52, .no 5, Econometric Society, 1984, pp. 1117-1128, https://www.jstor.org/stable/1910990
Chicago
Peters, Michael. “Bertrand Equilibrium with Capacity Constraints and Restricted Mobility.” Econometrica, 52, .no 5, (Econometric Society: 1984), 1117-1128. https://www.jstor.org/stable/1910990
APA
Peters, M. (1984). Bertrand Equilibrium with Capacity Constraints and Restricted Mobility. Econometrica, 52(5), 1117-1128. https://www.jstor.org/stable/1910990
We are deeply saddened by the passing of Kate Ho, the John L. Weinberg Professor of Economics and Business Policy at Princeton University and a Fellow of the Econometric Society. Kate was a brilliant IO economist and scholar whose impact on the profession will resonate for many years to come.
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