Katia Luchetta

Computer Science and Simulation for Economics

Project work on

"Monopolistic price segmentation."


The applet requires Java 1.4.1 or higher. It will not run on Windows 95 or Mac OS 8 or 9. Mac users must have OS X 10.2.6 or higher and use a browser that supports Java 1.4. (Safari works, IE does not. Mac OS X comes with Safari. Open Safari and set it as your default web browser under Safari/Preferences/General.) On other operating systems, you may obtain the latest Java plugin from Sun's Java site.

created with NetLogo

view/download model file: monopolistic_price_segmentation.nlogo


The program is a simulation of a "monopolistic market".


In my program there are two agents: consumers and a firm (shop).

Consumers (turtles) want to spend a certain sum of money and the shop (patches), that is a monopolist in his market, offers an other price. Consumers move themselves randomly, go in the shop and if the shop's price is interesting for them, they stop moving and buy. Hence, if the product is more dear than their possibility, they go out.
A further hypothesis is that in the market there is a discrimination of the price offered by the shop: if the customer has less than 50 years, the shop practices a certain price; if he is old, the price is different.


The observer can:
- choose the numbers of customers (represented by a "white face neutral");
- click to "SETUP" button in order to set up turtles and patches;
- click "RUN" to start the simulation. If customer buyes, the turtle will become "green and happy", otherwise turtle will become "red and sad".

* "shop_price" and the "shop_price_old" monitors show the price offered by the shop (respectively, for younger and older people);
* the "quantity" monitor shows the quantity of the product;
* the "age" monitor shows the age of consumers;
* "cons_surplus" and "cons_surplus_old" show the surplus of consumers.


The program is able to show that if the sum of money owned by consumers is higher than the firm's price then the customer will buy, otherwise he won't buy.
If the customer doesn't buy more than "n" times, he will increase his max_price, conversely he reduces it.
Firms change the price that they offer according to the movement of consumers.


Thanks to my model of simulation, the observer can see the movement of two types of consumers: he is able to see how prices can varie according to their movements, and also their surplus.