The effect of competition between two spatially separated markets - An investigation of two interlinked Bak-Sneppen models
AbstractThis paper investigates the effect of competition in a market consisting of interlinked economic agents. In particular, the effect of increased competition from the surrounding markets is demonstrated. The presented work is an extension of the Bak-Sneppen model (Bak and Sneppen 1993). Here are two Bak-Sneppen models interlinked such that if the lowest fitness value of one market exceeds the fitness values of the other market minus transportation cost, all cells lower than this band will receive a new random value. The model shows that interdependency between markets has a strong effect on the competitiveness of the least competitive market. The external competition is able to make the least competitive market perform better as well as worse than on its own.
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Bibliographic InfoPaper provided by European Association of Agricultural Economists in its series 2008 International Congress, August 26-29, 2008, Ghent, Belgium with number 44056.
Date of creation: 2008
Date of revision:
Bak-Sneppen model; interdependency; competition; Marketing;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-11-25 (All new papers)
- NEP-COM-2008-11-25 (Industrial Competition)
- NEP-MIC-2008-11-25 (Microeconomics)
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