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Endogenous local interaction and multi-product firms

Author

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  • Bauke Visser

    (Shell Services International BV, Postbox 162, NL-2501 AN The Hague, The Netherlands)

Abstract

Multi-product firms are modelled as locally interacting entities that gather information on the profitability of product combinations in an environment defined in terms of their currently supplied markets. They learn from their own past play. Local information gathering may slow down convergence and may prohibit profit rates from becoming equal. Cycles show parts of the economy that are in rest, while others remain in a state of flux. The first two results stem from the endogeneity of the interaction structure, while the third follows from the interplay of learning and information gathering.

Suggested Citation

  • Bauke Visser, 1999. "Endogenous local interaction and multi-product firms," Journal of Evolutionary Economics, Springer, vol. 9(2), pages 243-263.
    • Handle: RePEc:spr:joevec:v:9:y:1999:i:2:p:243-263
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    References listed on IDEAS

    as
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    Cited by:

    1. Otto H. Swank & Bauke Visser, 2015. "Learning from Others? Decision Rights, Strategic Communication, and Reputational Concerns," American Economic Journal: Microeconomics, American Economic Association, vol. 7(4), pages 109-149, November.

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    More about this item

    Keywords

    Multi-product firms ; Diversification ; Information gathering ; Learning;
    All these keywords.

    JEL classification:

    • C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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