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Agent Heterogeneity and Facility Congestion

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  • Taiyo Maeda
  • Shigeru Matsumoto
  • Tadahiko Murata

Abstract

This paper extends Selten et al.’s (Games Econ Behav 58:394–406, 2007 ) laboratory experiment of an agent’s choice behavior by offering eight subjects a choice between one of two facilities that provide an identical service. We assume that the cost of using these facilities depends on their congestion level and that there are two types of agents with different congestion costs: high- and low-cost agents. High-cost agents are affected by congestion more severely than low-cost agents. The theory of congestion games predicts that cost heterogeneity will not affect the facility choices of agents. We obtain experimental results that support this theoretical prediction, namely that cost heterogeneity influences neither the facility choices of agents nor the congestion levels of facilities. By using data derived from the laboratory experiment, we then develop state-action tables and computationally simulate the facility choices of subjects. We find that a subject decides whether he or she remains in the same facility or moves to the other facility in the next period according to the current congestion level. Copyright Springer Science+Business Media New York 2015

Suggested Citation

  • Taiyo Maeda & Shigeru Matsumoto & Tadahiko Murata, 2015. "Agent Heterogeneity and Facility Congestion," Computational Economics, Springer;Society for Computational Economics, vol. 46(2), pages 189-203, August.
  • Handle: RePEc:kap:compec:v:46:y:2015:i:2:p:189-203
    DOI: 10.1007/s10614-014-9451-x
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    References listed on IDEAS

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    1. Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January.
    2. Milchtaich, Igal, 1996. "Congestion Games with Player-Specific Payoff Functions," Games and Economic Behavior, Elsevier, vol. 13(1), pages 111-124, March.
    3. Kandori, Michihiro & Mailath, George J & Rob, Rafael, 1993. "Learning, Mutation, and Long Run Equilibria in Games," Econometrica, Econometric Society, vol. 61(1), pages 29-56, January.
    4. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
    5. Oakland, William H., 1972. "Congestion, public goods and welfare," Journal of Public Economics, Elsevier, vol. 1(3-4), pages 339-357, November.
    6. Selten, R. & Chmura, T. & Pitz, T. & Kube, S. & Schreckenberg, M., 2007. "Commuters route choice behaviour," Games and Economic Behavior, Elsevier, vol. 58(2), pages 394-406, February.
    7. Berglas, Eitan & Pines, David, 1981. "Clubs, local public goods and transportation models : A synthesis," Journal of Public Economics, Elsevier, vol. 15(2), pages 141-162, April.
    8. Anna Bogomolnaia & Antonio Nicolò, 2005. "Stable Assignment of Public Facilities under Congestion," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 7(1), pages 65-91, February.
    9. Scotchmer, Suzanne & Wooders, Myrna Holtz, 1987. "Competitive equilibrium and the core in club economies with anonymous crowding," Journal of Public Economics, Elsevier, vol. 34(2), pages 159-173, November.
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    1. Agam Gupta & Biswatosh Saha & Uttam K. Sarkar, 2017. "Emergent Heterogeneity in Keyword Valuation in Sponsored Search Markets: A Closer-to-Practice Perspective," Computational Economics, Springer;Society for Computational Economics, vol. 50(4), pages 687-710, December.

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