This note analyzes the repeated interaction among buyers of a homogeneous good, in a setting of imperfect buyer mobility. The buyers are assumed to play a dynamic game of imperfect information: at each stage every buyer chooses which seller to visit without knowing the current and past choices of the other buyers. A norm of conditional loyalty might prevail, according to which buyers keep loyal if previously served. Under generalized conditional loyalty, an efficient allocation is certainly reached in a finite number of stages. There is a clear case for boundedly rational buyers to keep conditionally loyal. And, most importantly, for the two−seller case we are able to establish adherence to a strategy of conditional loyalty as an “assessment equilibrium” of the dynamic buyer game.

DE FRANCESCO, M.A. (2005). Matching buyers and sellers. ECONOMICS BULLETIN, 3, 1-10.

Matching buyers and sellers

DE FRANCESCO, MASSIMO ALFIERO
2005

Abstract

This note analyzes the repeated interaction among buyers of a homogeneous good, in a setting of imperfect buyer mobility. The buyers are assumed to play a dynamic game of imperfect information: at each stage every buyer chooses which seller to visit without knowing the current and past choices of the other buyers. A norm of conditional loyalty might prevail, according to which buyers keep loyal if previously served. Under generalized conditional loyalty, an efficient allocation is certainly reached in a finite number of stages. There is a clear case for boundedly rational buyers to keep conditionally loyal. And, most importantly, for the two−seller case we are able to establish adherence to a strategy of conditional loyalty as an “assessment equilibrium” of the dynamic buyer game.
File in questo prodotto:
File Dimensione Formato  
matching buyers and sellers.pdf

accesso aperto

Tipologia: PDF editoriale
Licenza: PUBBLICO - Pubblico con Copyright
Dimensione 170.61 kB
Formato Adobe PDF
170.61 kB Adobe PDF Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11365/26975