Suppose there is an airline that wants to sell 200 seats in a flight. It can either sell them as business class or as economy. Ideally it would sell all as business class, but it is willing to give away seats as economy in case not all can be sold as business class.
Then there is a number of consumer, which all prefer economy seats, but each of them is willing to buy business class in case no economy seat is available.
- Is this a well-known problem?
- What is it called?
I suppose this is roughly a "game of chicken". But I believe in real markets there will some equilibrium, but I don't know what it depends on.