Year: 2025
Type: article
Abstract: This paper extends a random version of Bertrand model with Brownian motion. The model can be used to adjust price with changing economic environment, as it can serve to capture the behaviours of managers who seek to avoid errors in identifying the optimal response in dynamic price settings within their respective markets. The equilibrium of a stochastic game model is further discussed with the solution solved by Hamilton-Jacobi-Bellman equations, and the equilibrium exhibited fluctuations in the numerical simulation, with a constant value being observed. Finally, the model shows that organisations that are less efficient at managing errors, particularly those with a smaller market share, are more susceptible to failure.
Source: Scientific Reports
Authors: Bingyuan Gao, Xi Gao, Shaohua He
Institutions: Yuncheng University, Wuhan University, Lancaster University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $2,690
Award: G7268931695
OpenAlex ID: W4417479360