Capacity competition of make-to-order firms

✍ Scribed by Hong Chen; Yat-wah Wan

• Book ID: 103877601
• Publisher: Elsevier Science
• Year: 2005
• Tongue: English
• Weight: 190 KB
• Volume: 33
• Category: Article
• ISSN: 0167-6377
• DOI: 10.1016/j.orl.2002.08.001

✦ Synopsis

Two make-to-order firms, each modelled as a single-server queue, compete for a common stream of (potential) customers by setting their service capacities (rates) and service prices. Each customer maximizes her expected return by getting service from a firm or by balking. We completely characterize the Nash equilibrium of the competition.