Asymmetric Equilibria in Stahl Search Model
Abstract
The paper explores the classic consumer search model introduced by Stahl in (Stahl, 1989). Literature uses the unique symmetric Nash Equilibrium, but does little to discuss asymmetric Equilibria. This paper describes all possible asymmetric Nash Equilibria of the original model, under the common literature assumption of consumer reserve price. Those include strategies of three types: pure, continuous mixing and a mixture of the previous two types. The findings suggest that on some level, lower than the symmetric Equilibrium, price dispersion will still exist, together with some level of price stickiness, both observed in reality.
Keywords:
Sequential Consumer Search, Oligopoly, Asymmetric NE
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Articles of "Contributions to Game Theory and Management" are open access distributed under the terms of the License Agreement with Saint Petersburg State University, which permits to the authors unrestricted distribution and self-archiving free of charge.
