Variational Inequalities and Networks in the Formulation and Computation of Market Equilibria and Disequilibria: The Case of Direct Demand Functions

Nagurney, Anna; Zhao, Lan
February 1993
Transportation Science;Feb93, Vol. 27 Issue 1, p4
Academic Journal
In this paper we introduce competitive spatial market models with direct demand functions, which permit policy interventions in the form of price controls. We derive variational inequality formulations of the governing economic conditions and establish existence and uniqueness results. A decomposition algorithm that exploits the network structure is proposed and convergence results given. The algorithm is then interpreted as an adjustment process to highlight the underlying economic behavior. Finally, numerical results for a variety of problems are presented.


Related Articles

  • A note on 'Price variation in spatial markets: the case of perfectly inelastic demand' Scholer, Klaus // Annals of Regional Science;Mar1991, Vol. 25 Issue 1, p55 

    Comments on G. Mulligan and T. Fik's article about price variations in spatial markets. Demand functions of the consumer; Determination of equilibrium prices; Profit-maximizing behavior of the firm; Conjectural behavioral patterns of the spatial competition model; Spatial distribution of the firms.

  • Duopoly signal jamming. Mirman, Leonard J.; Samuelson, Larry; Urbano, Amparo // Economic Theory;1993, Vol. 3 Issue 1, p129 

    This paper examines a repeated duopoly market with heterogeneous outputs. Firms have (common) prior beliefs over the values of an unknown parameter of each firm's demand curve. Firms cannot observe rivals' quantities, but can observe market prices, which are subject to random disturbances and...

  • Estimating demand for new products using a discrete price variable. Campbell, Randall C // Journal of Targeting, Measurement & Analysis for Marketing;Mar2008, Vol. 16 Issue 2, p115 

    We conduct a set of Monte Carlo sampling experiments to examine the use of discrete explanatory variables in market research for new products. We compare three alternative estimators on the basis of mean square error. As part of the experimental design we vary the number of price points and the...

  • On Measuring the Value of a Nonmarket Good Using Market Data. Bullock, David S.; Minot, Nicholas // American Journal of Agricultural Economics;Nov2006, Vol. 88 Issue 4, p961 

    We use line integral theory to lay out in a more general theoretical framework the conditions under which it is possible to measure with market data the welfare effects of a change in a nonmarket good. We present in detail a numerical method of measuring the value of nonmarket goods using market...

  • The Role of Production Lead Time and Demand Uncertainty in Marketing Durable Goods. Desai, Preyas S.; Koenigsberg, Oded; Purohit, Devavrat // Management Science;Jan2007, Vol. 53 Issue 1, p150 

    Firms often have to make their production decisions under conditions of demand uncertainty. This is especially true for product categories such as automobiles and technology goods where the lead time needed for manufacturing forces firms to make production decisions well in advance of the...

  • A Mathematical Model of a Fishery with Variable Market Price: Sustainable Fishery/Over-exploitation. Mansal, Fulgence; Nguyen-Huu, Tri; Auger, Pierre; Balde, Moussa // Acta Biotheoretica;Sep2014, Vol. 62 Issue 3, p305 

    We present a mathematical bioeconomic model of a fishery with a variable price. The model describes the time evolution of the resource, the fishing effort and the price which is assumed to vary with respect to supply and demand. The supply is the instantaneous catch while the demand function is...

  • A class of utility functions yielding linear demand functions. Alperovich, Gershon; Weksler, Itzhak // American Economist;Spring96, Vol. 40 Issue 1, p20 

    Focuses on linear demand functions as a form for deriving properties of economic models. Use of linear demand functions in microeconomic textbooks to demonstrate different properties of demand; Adoption of linearity assumption for analytical convenience; Derivation of the utility function.

  • Flexible Consumer Demand Functions and Linear Estimation:Comment. Wohlgenant, Michael K. // American Journal of Agricultural Economics;Feb85, Vol. 67 Issue 1, p141 

    Comments on an article which presented a model of consumer demand functions and linear estimation. Criticism on the method of derivation used; Details of the Hicksian demand function; Limitations of the model.

  • Third Degree Price Discrimination in Linear-Demand Markets: Effects on Number of Markets Served and Social Welfare. Kaftal, Victor; Pal, Debashis // Southern Economic Journal;Oct2008, Vol. 75 Issue 2, p558 

    We analyze the welfare impact of monopolistic third degree price discrimination when all markets are not necessarily served by uniform pricing. We consider n markets with linear demand curves. Each demand is characterized by the price intercept of the demand curve and by the size of the market,...


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics