Pareto Optimum Cournot-Nash Equilibrium in Wireless Internet Services Markets without Rollover of Unused Balance

Abstract

It is always difficult to choose the right internet package with different prices/GB, data volume, and validity period that vary from package to package. Consumers are often confused to identify the best offer for them, given their necessities and preferences. The present paper proposes a model with a set of offers made by a seller where these offers vary in terms of price and validity period, given the data volume. On the other hand, consumers always prefer a lower price, larger volume, and longer validity period. The model strikes a balance between the preferences of consumers and the offers made by the seller. It has been found that in the equilibrium a classic Pareto optimum Cournot-Nash equilibrium exists. The model uses a three-dimensional Edgeworth Box Diagram to explain the offer curve of the seller and the preference curve of the consumers. The model includes an empirical test. The empirical test supports the model.