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Competition among brands that sell through a supermarket chain is a repeated moderated oligopoly, where the retailer moderates brand competition by choosing the store promotions that consumers see each week. The interactions between consumers, retailers and brand managers are complex, with each having different goals and constraints. Here the author use regression and Genetic Algorithm techniques to model these interactions. The goal is to address an important question in the literature; specifically whether the retailer gains positive returns through more sophisticated moderation. In doing so, the author draws on work in economics showing that unsophisticated or Zero-Intelligence (ZI) agents can often replicate real-world outcomes.
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