Duopoly Competition in Dynamic Spectrum Leasing and Pricing
This paper presents a comprehensive analytical study of two competitive secondary operators' investment (i.e., spectrum leasing) and pricing strategies, taking into account operators' heterogeneity in leasing costs and users' heterogeneity in transmission power and channel conditions. The authors model the interactions between operators and users as a three-stage dynamic game, where operators simultaneously make spectrum leasing decisions in Stage I, and pricing decisions in Stages II, and then users make purchase decisions in Stage III. Using backward induction, they are able to completely characterize the dynamic game's equilibria. They show that both operators' investment and pricing equilibrium decisions process interesting threshold properties.