Strategy bifurcation and spatial inhomogeneity in a simple model of competing sellers

Graeme Ackland, Lawrence Mitchell

Research output: Contribution to journalArticlepeer-review

Abstract

We present a simple one-parameter model for spatially localised evolving agents competing for spatially localised resources. The model considers selling agents able to evolve their pricing strategy in competition for a fixed market. Despite its simplicity, the model displays extraordinarily rich behaviour. In addition to "cheap" sellers pricing to cover their costs, "expensive" sellers spontaneously appear to exploit short-term favourable situations. These expensive sellers "speciate" into discrete price bands. As well as variety in pricing strategy, the "cheap" sellers evolve a strongly correlated spatial structure, which in turn creates niches for their expensive competitors. Thus an entire ecosystem of coexisting, discrete, symmetry-breaking strategies arises. Copyright (C) EPLA, 2007.

Original languageEnglish
Article number48003
Pages (from-to)-
Number of pages6
JournalEurophysics Letters
Volume79
Issue number4
DOIs
Publication statusPublished - Aug 2007

Keywords

  • PRICE DISPERSION
  • EVOLUTIONARY GAMES
  • COOPERATION
  • SALES

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