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Mixed pricing in oligopoly with limited monopoly

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  • Wen, Zhong

Abstract

We analyze price competition between two brands. Buyers consist of switchers and two segments of customers with limited brand loyalty. We identify a unique symmetric mixed-strategy price equilibrium and find that competition is most relaxed when there exists some switchers.

Suggested Citation

  • Wen, Zhong, 2014. "Mixed pricing in oligopoly with limited monopoly," Economics Letters, Elsevier, vol. 125(1), pages 87-92.
    • Handle: RePEc:eee:ecolet:v:125:y:2014:i:1:p:87-92
    DOI: 10.1016/j.econlet.2014.08.021
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    References listed on IDEAS

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    More about this item

    Keywords

    Brand loyalty; Price dispersion; Game theory; Mixed strategy;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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