Competition and welfare for a stochastically fluctuating market with irreversible decisions

Yasunori Fujita

doi:10.1016/j.physa.2008.01.004

Competition and welfare for a stochastically fluctuating market with irreversible decisions

Yasunori Fujita

Faculty of Economics

Research output: Contribution to journal › Article › peer-review

Abstract

The present paper, in the sprit of econophysics, attempts to shed new light on the aspect that was missed in the traditional economic analysis. More precisely, the present paper combines the optimal stopping model and the economic model into a single structure and examines the relationship between the competition and the welfare, which has been a major focus of the recent economic analysis. The main finding is that in a stochastically fluctuating small market, suppression of the competition increases the growth rate of the welfare-stochastic version of the 'excess entry theorem.'.

Original language	English
Pages (from-to)	2846-2850
Number of pages	5
Journal	Physica A: Statistical Mechanics and its Applications
Volume	387
Issue number	12
DOIs	https://doi.org/10.1016/j.physa.2008.01.004
Publication status	Published - 2008 May 1

Keywords

Excess entry theorem
Homogeneous products
Irreversible decision
Optimal stopping theory

ASJC Scopus subject areas

Statistics and Probability
Condensed Matter Physics

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10.1016/j.physa.2008.01.004

Cite this

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AB - The present paper, in the sprit of econophysics, attempts to shed new light on the aspect that was missed in the traditional economic analysis. More precisely, the present paper combines the optimal stopping model and the economic model into a single structure and examines the relationship between the competition and the welfare, which has been a major focus of the recent economic analysis. The main finding is that in a stochastically fluctuating small market, suppression of the competition increases the growth rate of the welfare-stochastic version of the 'excess entry theorem.'.

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KW - Homogeneous products

KW - Irreversible decision

KW - Optimal stopping theory

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Competition and welfare for a stochastically fluctuating market with irreversible decisions

Abstract

Keywords

ASJC Scopus subject areas

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