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Stackelberg competition
About: Stackelberg competition is a research topic. Over the lifetime, 6611 publications have been published within this topic receiving 109213 citations.
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TL;DR: In this article, the authors compare the Stackelberg game with a bargaining game, and show that the game structure of the two-tier supply chain system is not a sufficient device to predict contracting behaviors in reality.
Abstract: We analyze contracting behaviors in a two-tier supply chain system consisting of competing manufacturers and competing retailers. We contrast the contracting outcome of a Stackelberg game, in which the manufacturers offer take-it-or-leave-it contracts to the retailers, with that of a bargaining game, in which the firms bilaterally negotiate contract terms via a process of alternating offers. The manufacturers in the Stackelberg game possess a Stackelberg-leader advantage in that the retailers are not entitled to make counteroffers. Our analysis suggests that whether this advantage would benefit the manufacturers depends on the contractual form. With simple contracts such as wholesale-price contracts, which generally do not allow one party to fully extract the trade surplus, the Stackelberg game replicates the boundary case of the bargaining game with the manufacturers possessing all the bargaining power. In contrast, with sophisticated contracts such as two-part tariffs, which enable full surplus extraction, the two games lead to distinct outcomes. We further show that the game structure being Stackelberg or bargaining critically affects firms' preferences over contract types and thus their equilibrium contract choices. These observations suggest that the Stackelberg game may not be a sufficient device to predict contracting behaviors in reality where bargaining is commonly observed.
119 citations
20 May 2018
TL;DR: In this article, the optimal pricing-based edge computing resource management to support mobile blockchain applications where the mining process can be offloaded to an edge computing Service Provider (ESP) is investigated.
Abstract: As the core issue of blockchain, the mining requires solving a proof-of-work puzzle, which is resource expensive to implement in mobile devices due to the high computing power needed. Thus, the development of blockchain in mobile applications is restricted. In this paper, we, for the first time, consider the edge computing as the network enabler for mobile blockchain. In particular, we study optimal pricing-based edge computing resource management to support mobile blockchain applications where the mining process can be offloaded to an Edge computing Service Provider (ESP). We adopt a two-stage Stackelberg game to jointly maximize the profit of the ESP and the individual utilities of different miners. In Stage~I, the ESP sets the price of edge computing services. In Stage~II, the miners decide on the service demand to purchase based on the observed prices. We apply the backward induction to analyze the sub-game perfect equilibrium in each stage for uniform and discriminatory pricing schemes. Further, the existence and uniqueness of Stackelberg game are validated for both pricing schemes. At last, the performance evaluation shows that the ESP intends to set the maximum possible value as optimal price for profit maximization under uniform pricing. In addition, the discriminatory pricing helps the ESP to encourage higher total service demand from miners and achieve greater profit correspondingly.
119 citations
TL;DR: Basic and enhanced interaction strategies between a grid and buildings are developed using the Stackelberg game based on their identified Nash equilibria and the results show that the proposed basic interaction increased net profit by 8% and reduced demand fluctuation by about 40% and relieved the negative effects caused by prediction uncertainty.
119 citations
TL;DR: In this paper, the authors explored channel coordination and profit division issues of a manufacturer-distributer-duopolistic retailers supply chain for a product, where the manufacturer supplies lotsize of the product that contains a random portion of imperfect quality item.
116 citations
TL;DR: It is shown that there exists a generalized Nash game between transit operators, which can be formulated as a quasi-variational inequality problem and solved by a heuristic solution algorithm based on a sensitivity analysis approach.
Abstract: This paper presents a bilevel transit fare equilibrium model for a deregulated transit system. In the upper-level problem, the transit competition is portrayed as an n-player, non-cooperative game by changing the fare structure of each of a set of transit lines separately so as to maximize the profit of each transit operator within the oligopolistic market. We show that there exists a generalized Nash game between transit operators, which can be formulated as a quasi-variational inequality problem. In the lower-level problem, the passengers' response to the equilibrium fare structure of the transit operators is represented by the stochastic user equilibrium transit assignment model with elastic OD demand. As a result, the bilevel transit fare equilibrium problem is presented in the Stackelberg form and solved by a heuristic solution algorithm based on a sensitivity analysis approach. A numerical example is given to illustrate the competition mechanism on the transit network and some useful findings are presented on competitive operations. (c) 2004 Elsevier Ltd. All rights reserved.
114 citations