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Title:Satisficing and prior-free optimality in price competition: a theoretical and experimental analysis PDF Logo
Authors:Güth, Werner
Levati, Maria Vittoria
Ploner, Matteo
Issue Date:2008
Series/Report no.:Jena economic research papers 2008,067
Abstract:On a heterogeneous experimental oligopoly market, sellers choose a price, specify a set-valued prior-free conjecture about the others' behavior, and form their own profit-aspiration for each element of their conjecture. We formally define the concepts of satisficing and prior-free optimality and check if seller participants behave in accordance with them. We find that seller participants are satisficers, but fail to be prior-free optimal.
Subjects:Satisficing behavior
bounded rationality
triopoly
JEL:C92
C72
D43
Document Type:Working Paper
Appears in Collections:Jena Economic Research Papers, MPI für Ökonomik

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