How does nash equilibrium differ from the nash equilibrium

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Reference no: EM133363843

Question: Consider a variant of Hotelling's model with two parties in which the voters' preferences are asymmetric. Speci?cally, suppose that each voter cares twice as much about policy dif- ferences to the left of her favorite position than about policy differences to the right of her favorite position. For example, suppose that the position of party 1 is 0.2 and the position of party 2 is 0.5. Then a citizen whose favorite position is 0.35 prefers party 2 to party 1, and a citizen whose favorite position is 0.3 is exactly indifferent between the two parties (because the distance between her favorite position and the position of party

1 is exactly half of the distance between her favorite position and the position of party

2). How does the Nash equilibrium differ from the Nash equilibrium of Hotelling's model?

Reference no: EM133363843

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