Stackelberg competition

About: Stackelberg competition is a research topic. Over the lifetime, 6611 publications have been published within this topic receiving 109213 citations.

Conflicts and Incentives in Wireless Cooperative Relaying: A Distributed Market Pricing Framework

Abstract: Extensive research in recent years has shown the benefits of cooperative relaying in wireless networks, where nodes overhear and cooperatively forward packets transmitted between their neighbors. Most existing studies focus on physical-layer optimization of the effective channel capacity for a given transmitter-receiver link; however, the interaction among simultaneous flows between different endpoint pairs, and the conflicts arising from their competition for a shared pool of relay nodes, are not yet well understood. In this paper, we study a distributed pricing framework, where sources pay relay nodes to forward their packets, and the payment is shared equally whenever a packet is successfully relayed by several nodes at once. We formulate this scenario as a Stackelberg (leader-follower) game, in which sources set the payment rates they offer, and relay nodes respond by choosing the flows to cooperate with. We provide a systematic analysis of the fundamental structural properties of this generic model. We show that multiple follower equilibria exist in general due to the nonconcave nature of their game, yet only one equilibrium possesses certain continuity properties that further lead to a unique system equilibrium among the leaders. We further demonstrate that the resulting equilibria are reasonably efficient in several typical scenarios.

Vertical relations in the air transport industry: A facility-rivalry game

Abstract: This paper investigates contracts between airports and airlines, in the context of two competing facilities and three types of agreements The downstream market consists in a route operated by one leader and n − 1 followers competing a la Stackelberg in each facility We develop a multistage game where each airport and its dominant airline decide whether to enter into a contract and which one to engage in We find that the airport and its dominant airline have incentives to collude in each facility Nevertheless, the equilibrium is not efficient in terms of social welfare: there is a misalignment between private and social incentives

Quantity discount pricing policies for heterogeneous retailers with price sensitive demand

Abstract: Although quantity discount policies have been extensively analyzed, they are not well understood when there are many different buyers. This is especially the case when buyers face price-sensitive demand. In this paper we study a supplier's optimal quantity discount policy for a group of independent and heterogeneous retailers, when each retailer faces a demand that is a decreasing function of its retail price. The problem is analyzed as a Stackelberg game whereby the supplier acts as the leader and buyers act as followers. We show that a common quantity discount policy that is designed according to buyers' individual cost and demand structures and their rational economic behavior is able to significantly stimulate demand, improve channel efficiency, and substantially increase profits for both the supplier and buyers. Furthermore, we show that the selection of all-units or incremental quantity discount policies has no effect on the benefits that can be obtained from quantity discounts. © 2005 Wiley Periodicals, Inc. Naval Research Logistics, 2005

Are Nonprofits Unfair Competitors for Businesses? An Analytical Approach

Abstract: This study examines duopoly price competition between a for-profit firm and a nonprofit organization. It shows that the competitive outcome is predominantly the consequence of their different objective functions. The damage to the for-profit caused by the nonprofit’s policy and regulatory advantages is only marginal. Moreover, the for-profit can protect itself by acquiring Stackelberg price leadership.