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Baye Morgan Scholten (2006) - Information Search and Price Dispersion (view source)
Revision as of 21:00, 25 January 2010
, 21:00, 25 January 2010no edit summary
*A continuum of price-setting firms with unit measure compete selling an homogenous product
*A mass <math>\mu</math> is interested in purchasing the product
*Consumers have quasi-linear utility(i.e. additively-seperable in income): <center><math>u(q) + y\,</math> where <math>y\,</math> is a numeraire good</center>
*The indirect utility of consumers is: <center><math>V(p,M) = v(p) + M\,</math> where <math>v(\cdot)\,</math> in nonincreasing in <math>p\,</math>, and <math>M\,</math> is income.</center>
*By [http://en.wikipedia.org/wiki/Roy%27s_identity Roy's identity]:
