This scenario appears in some engineering and economic applications like the determination of the consumer's equilibrium.
The approach of both the resource and consumer solutions to equilibrium values (Fig. 2A), used to produce Fig. 1, is lost once environmental forcing is included in the resource equations.
Open image in new window Fig. 3 Consumers' trade-off and multiple equilibrium a Consumers' trade-off b Multiple equilibrium of retail formats.
From the assumption that some consumers search in equilibrium, max { 0, ε ̲ − p 1 ⁎ } < x ^ − s − p 2 ⁎, we know that x ^ > ε ̲ + (s / 2 ).
From the assumption that some consumers search in equilibrium, max { 0, ε ̲ − p L ⁎ } < x ^ − s − p NL ⁎, we know that x ^ > ε ̲ + (s / 2 ).
Further, the model produces the unrealistic outcome that all consumers who search in equilibrium also decide to switch, such that consumers artificially view the two costs as equivalent.
Agriculture output quantity, total pollution or emission, equilibrium price, consumer and producer surplus, government budget, and social welfare are all addressed in this study.
When the level of the unhealthy attribute is relatively high compared to d (s ≥ 2d), product differentiation is so big that, in equilibrium, all consumers prefer to patronize firm 2. The highest net utility consumers can obtain from consuming the good from firm 1 is 1.
This methodology builds on a useful feature of the theoretical model where consumers differ in their expost equilibrium behaviour - a fraction of consumers do not search, a fraction of consumers search and switch and a fraction of consumers search but refrain from switching.
This time space (E1, E2, E3, E4,...) makes up a multiple equilibrium of consumers' and retailers' decisions.
