Repeated Time Allocation of National and Private Sector by Real Estate Agent

Abstract

This paper presents the time (real estate agent (broker)'s service hours) - allocation of two types of firms ' product (national (leader)-firm and private (follower)-firm) repeatedly. Where the strategy of the national (leader) firm is to decide the product whole sale price and the private developer plays a role of the follower with respect to maximize its payoff. We characterize the resulting Stackelberg equilibriu m in terms of time allocation to these developers as well as price with the parameters. A real estate agent controls the service hours which is taken in the normal form. In this game theoretic model, quality of the product is measured by baseline sales, brand substitution degree and price positioning. Future research through simu lating this model can show many more application results. Real estate agent (Broker) has crucial role in the production of the real estate product and their sale, for that he serves by serving in the allowed time period( Efficient hours of the service) which is limited resource that must be optimally d ivided among the different categories and their various real estate developer' product (Shops, Houses). Here, the issue of time-allocation and impact on agent's performance has attracted the attention of game theorist for preparing the model to solve the problem. Nat ional developer of the real estate (Leader-firm) and Private developer of the real estate (fo llo wer-firm) are distinct due to having some basic economic ability to produce a wide range of outputs with reasonable profit marg in and their size. We can distinct the leader and fo llower by emerging in industries comprised of some well established firms with sound assets, and other newer, more fragile firm. The fo llo wer firms, being less resilient to business shocks, may hence adopt a follower role in the market, awaiting for the more established leader firms to stabilize before making decisions on their own production levels. Undoubtedly, obtained equilibriu m solution is a fixed point of the dynamic process in which the leader-and follower-firms readjust output levels according to the strategic market assumptions.