Today I presented some preliminary results of a research project that is intended to be part of my PhD thesis. I discussed an economic model of price competition between spatially organized firms. I discussed the Nash equilibrium solution of the model, but most of the time I focused on the outcomes achieved by so-called evolutionary dynamics. These outcomes were analyzed mathematically (partly analytically, partly numerically) but also through computer simulations. Interestingly, on average firms turned out to cooperate (or collude) with each other under the evolutionary dynamics.
We had a very fruitful discussion about the conditions necessary/sufficient to achieve the cooperative outcome, focusing in particular on the plausibility of various assumptions. We also discussed on a general level the methodology typically used in economic/game-theoretic research.
Ludo
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