Location games with references
Computer Science and Game Theory
2022-07-29 v1 Optimization and Control
Abstract
We study a class of location games where players want to attract as many resources as possible and pay a cost when deviating from an exogenous reference location. This class of games includes political competitions between policy-interested parties and firms' costly horizontal differentiation. We provide a complete analysis of the duopoly competition: depending on the reference locations, we observe a unique equilibrium with, or without differentiation, or no equilibrium. We extend the analysis to a competition between an arbitrary number of players and we show that there exists at most one equilibrium which has a strong property: only the two most-left and most-right players deviate from their reference locations.
Keywords
Cite
@article{arxiv.2207.14044,
title = {Location games with references},
author = {Fournier Gaëtan and Francou Amaury},
journal= {arXiv preprint arXiv:2207.14044},
year = {2022}
}