Development of evolutionarily stable firm strategies on market

Authors

DOI:

https://doi.org/10.15587/2312-8372.2014.30337

Keywords:

evolutionary strategy, social preferences, reciprocity, punitive behavior, duopoly

Abstract

The formation of evolutionary stable strategies of companies to assess the level of competition in the market between them is examined in the article. The aim of the article is identification of evolutionarily stable strategies of firms in experimental economics with regard to social preferences among firms. To describe the competition between firms the Cournot model is used based on social preferences firms: selfish, reciprocal or punitive. Results of competition are modeled experimentally based on adaptive behavior of firms in a special software module. Based on the statistical data on the two firms using econometric methods it is defined the social preferences of firms to assess the level of competition between them. Evolutionary modeling of competition between firms allows estimating the dynamics of social preferences, depending on the marginal costs of firms. The developed econometric model allows determining the evolutionary stable strategies of firms and predicting the level of competition between them for a level of social preferences firms and statistical information about their income. Antimonopoly Committee proposes to use econometric modeling and experimental evaluation of social preferences of firms to predict the direction of competition between firms. The research results can be used to identify additional indexes concentration of firms in the economy of sector markets, taking into account the evolutionary adaptation strategies of firms to competition.

Author Biography

Віталій Миколайович Кобець, Kherson State University, 27, 40 rokiv Zhovtnya, Kherson, Ukraine, 73000

Candidate of Economic Science, Assosiate Professor

Department of Economic Theory

References

  1. Tnennenholtz, M. (1999, November). On Social Constraints for Rational Agents. Computational Intelligence, Vol. 15, № 4, 367–383.doi:10.1111/0824-7935.00098
  2. Faysse, N. (2005, April). Coping with the Tragedy of the Commons: Game Structure and Design of Rules. Journal of Economic Surveys, Vol. 19, № 2, 239–261.doi:10.1111/j.0950-0804.2005.00246.x
  3. Normann, H.-T., Ricciuti, R. (2009, July). Laboratory experiments for economic policy making. Journal of Economic Surveys, Vol. 23, № 3, 407–432. doi:10.1111/j.1467-6419.2008.00567.x
  4. Tanaka, Y. (2000, October). Stochastically stable states in an oligopoly with differentiated goods: equivalence of price and quantity strategies. Journal of Mathematical Economics, Vol. 34, № 2, 235–253. doi:10.1016/s0304-4068(00)00040-9
  5. Johnson, D. D. P., Price, M. E., Van Vugt, M. (2013, June). Darwin’s invisible hand: Market competition, evolution and the firm. Journal of Economic Behavior & Organization, Vol. 90, S128–S140. doi:10.1016/j.jebo.2012.12.016
  6. Alkemade, F. (2004). Evolutionary agent-based economics. Eindhoven: Technishe Universiteit Eindhoven, 204.
  7. Moreau, F. (2004, November 1). The role of the state in evolutionary economics. Cambridge Journal of Economics, Vol. 28, № 6, 847–874. doi:10.1093/cje/beh038
  8. Kobets, V., Poltoratskiy, M.; In: Ermolayev, V., Mayr, H. C. et al. (2014). Forming an Evolutionarily Stable Firm Strategy under Cournot Competition Using Social Preferences. 10th International Conference, ICTERI 2014, Kherson, Ukraine, June 06-10, 2014, LNCS. Vol. 469, 343-361. doi:10.1007/978-3-319-13206-8_17
  9. Kobets, V.; In: Ermolayev, V. et al. (2013). Mechanism Design for Foreign Producers of Unique Homogeneity Product. Proc. 9-th Int. Conf. ICTERI 2013, Kherson, Ukraine, June 19-22, 2013, 116-125. Available: CEUR-WS.org/Vol-1000/ICTERI-2013-CEUR-WS-Volume.pdf
  10. Bowles, S., Choi, J.-K., Hopfensitz, A. (2003, July). The co-evolution of individual behaviors and social institutions. Journal of Theoretical Biology, Vol. 223, № 2, 135–147. doi:10.1016/s0022-5193(03)00060-2
  11. Ahentstvo z rozvytku infrastruktury fondovoho rynku Ukrainy. Available: http://smida.gov.ua. Last accessed 17.11.2014.

Downloads

Published

2014-12-11

How to Cite

Кобець, В. М. (2014). Development of evolutionarily stable firm strategies on market. Technology Audit and Production Reserves, 6(2(20), 12–16. https://doi.org/10.15587/2312-8372.2014.30337

Issue

Vol. 6 No. 2(20) (2014): Economics and management of enterprise. Mathematical methods, models and information technologies in economics

Section

Economics and Enterprise Management: Original Research

License

Copyright (c) 2016 Віталій Миколайович Кобець

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

The consolidation and conditions for the transfer of copyright (identification of authorship) is carried out in the License Agreement. In particular, the authors reserve the right to the authorship of their manuscript and transfer the first publication of this work to the journal under the terms of the Creative Commons CC BY license. At the same time, they have the right to conclude on their own additional agreements concerning the non-exclusive distribution of the work in the form in which it was published by this journal, but provided that the link to the first publication of the article in this journal is preserved.