INDIVIDUAL RESERVATION BEHAVIOR UNDER UNCERTAINTY

Abstract

In this paper, the individual behavior to reserve services whose supply is constrained in markets is investigated. An individual is supposed to reserve services by taking into account the supply- and demandsidesrisks. The former risk is formulated by probability that the individual may fails in consuming theservice in future, while the latter is the one tha the/she may cancel the reservation. The rational expectation equilibrium model is formulated to describe how the supply-side risk emerges from market transactions.