Market Organisation and Trading Relationships

G. Weisbuch, Alan Kirman and Dorothea Herreiner

G.R.E.Q.A.M. from Universite Aix-Marseille III

Abstract: This paper analyses the evolution of trading relationships in a market in which trades take place bilaterally. Buyers reinforce their probability of visiting sellers as a function of the profitability of their past experience. Using the "mean field" approach it is shown that two distant types of behaviour "loyalist" and "shopper" emerge and that the transition from one to the other is abrupt. These results are confirmed by simulations of more complicated versions of the model.

Keywords: LEARNING; MARKETS; GOODS; CONSUMPTION (search for similar items in EconPapers)
JEL-codes: D4 L16 Q22 (search for similar items in EconPapers)
Pages: 33 pages
Date: 1998
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Citations: View citations in EconPapers (4)

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Journal Article: Market Organisation and Trading Relationships (2000)
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Persistent link: https://EconPapers.repec.org/RePEc:fth:aixmeq:98a32

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