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The competitive relationships among ports become complicated as the consequence of the prosperity of international trade. Typical oligopoly competition models cannot be competent for the analysis of ports competition in real scenario. In this paper, the scale-free network is adopted to characterize the interactions among ports with various number of neighbors. For each port node, not only direct competition but also indirect influences exerted by its neighbor are taken into account. Following the hypothesis in evolutionary game theory, social learning behavior among competitors occurs generally in our model. Conforming to reality, strategies considering both price collusion and price competition are proposed to investigate evolutionary dynamics of competition among ports in the self-organization process of imitation. It shows that neighbors have the same goal but play different roles in affecting strategy transition during the evolution with two competitive means. We explore how evolutionary dynamics are influenced by different imitation means. Then this paper verifies that price collusion is more conducive to port development when abundant resources is provided. Our results obtained in this evolutionary framework with different imitation means may enhance port-operation efficiency.
In this paper, the market of software products is considered. Regularly this market is suffering from existence of counterfeit or pirate products which causes problems and challenges for original software developers. Taking this fact into account the paper is trying to solve the problem of price competition on this market. The software company set the price and the quality of the software product while the counterfeit or pirate company suggests the consumers the product of the lower quality. First the general model is analyzed and price equilibrium is defined. Second, the monopoly case is considered separately and optimal software price is defined. Finally, it is supposed that there are two companies that produce original software on the market who compete and differentiate in product quality, and there are two pirate companies who produce the same type of software. The duopoly case is analyzed and equilibrium prices for competing companies are obtained in the explicit form.
In this paper, we examine the information-sharing behavior of firms in a distribution channel context. Channel alliance initiatives like ECR and category management often involve pooling of information available with manufacturers and retailers. Such pooling of information should lead to better decision making and hence it is desirable. However, in practice, category management is often implemented with an intriguing institution of category captain, that involves the retailer entering into an alliance with only one (of many) supplier in a category.
We first analyze the information sharing incentives of a manufacturer and retailer in a bilateral monopoly and identify the importance of quality of information available with the firms and the degree of complementarity of resources in determining the effectiveness of information sharing. We then show how these forces might lead to the emergence of the category captain phenomena in a model with competing manufacturers selling through a common retailer.
This research focuses on how price changes influence the observed pattern of brand competition. The paper begins with a basic utility model formulation and examines the implications of three major classes of preference distributions on the expected patterns of competition. A price-tier model is proposed to operationalize the theory and to allow predictive testing. The price-tier model is estimated on 28 brands across four product categories.
The results show a specific asymmetric pattern of price competition. Higher-price, higher quality brands steal share from other brands in the same price-quality tier, as well as from brands in the tier below. However, lower-price, lower-quality brands take sales from their own tier and the tier below brands, but do not steal significant share from the tiers above. The results are consistent with a bimodal preference distribution, with the regular price indifference point being located toward the lower-quality end of the preference distribution for the categories analyzed.
When large retailers merge, there is a concern that a sudden and marked increase in concentration will alter the intensity and nature of price competition to the detriment of consumers. This chapter considers just such a situation in regard to UK grocery retailing, which has witnessed steadily increasing concentration over recent years, advanced by a series of mergers. Specifically, we examine the nature of price competition amongst the major “one-stop-shop” retail chains before, during, and after the Safeway/Morrison merger in March 2004.We find the merger offered consumers an immediate windfall benefit — with average prices falling straight after the merger — and more intriguingly appears to have led to (or at least is associated with) a marked change in the character of price competition in the market.
We consider the interaction between an incumbent firm and a potential entrant, and examine how this interaction is affected by demand fluctuations. Our model gives rise to procyclical entry, prices, and price-cost margins, although the average price in the market can be countercyclical if the entrant is a first mover, and capacity utilization can be either pro- or countercyclical if the incumbent is a first mover. Moreover, our results show that entry deterrence by the incumbent firm can either amplify or dampen the effect of demand fluctuations on prices, price-cost margins, and capacity utilization.