Competition and efficiency in congested markets
By: Daron Acemoglu, Asuman Ozdaglar.
Contributors: Ozdaglar, Asuman E.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11201; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11201.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Oligopolies -- Mathematical models.; Competition -- Mathematical models.
Description: "We study the efficiency of oligopoly equilibria in congested markets.  The motivating examples are the allocation of network flows in a communication network or of traffic in a transportation network.  We show that increasing competition among oligopolists can reduce efficiency, measured as the difference between users' willingness to pay and delay costs.  We characterize a tight bound of 5/6 on efficiency in pure strategy equilibria.  This bound is tight even when the number of routes and oligopolists is arbitrarily large.  We also study the efficiency properties of mixed strategy equilibria"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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