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Massimo A. De Francesco
 
''Matching buyers and sellers''
( 2005, Vol. 3 No.31 )
 
 
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.
 
 
Keywords: assessment equilibrium
JEL: C7 - Game Theory and Bargaining Theory:General
L0 - Industrial Organization: General
 
Manuscript Received : Jun 11 2005 Manuscript Accepted : Jun 14 2005

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