An Evolutionary Model of Electricity Sales Market Considering Changes in Rational Hierarchy and Belief Structure for Subjective

[Objective] To deepen the reform of the electricity retail market， this study addresses the emergence of excess returns obtained by electricity retailers due to the heterogeneity of market players' beliefs， which undermines market stability. Accordingly， an evolutionary model of the electricity retail market is constructed based on bounded rationality， incorporating the belief structures of user groups and the rational hierarchy of electricity retailers. [Methods] K-level and CH-level models are employed to represent the belief structure of user groups and the rational decision-making hierarchy of electricity retailers， respectively. A quotation strategy equation for electricity retailers is provided. Based on the distribution of rational hierarchies， a replicator dynamics equation is proposed to analyze the correction of optimal quotation strategies and the evolutionary process of electricity retailers' rational hierarchies under varying belief structures of user groups. [Results] The study shows that when the user group’s belief structure is 0‰—indicating no consensus on the electricity retail market—the electricity retailer's quotation is 1.91 CNY/kWh. When the belief structure is 20‰—with 20 out of 1000 users reaching consensus—the quotation decreases to 0.45 CNY/kWh. When the belief structure reaches 1—indicating full consensus among all 1000 users— the electricity retailer's quotation rises slightly to 0.59 CNY/kWh. [Conclusions] The belief structure of user groups reflects the initial， expansion， and mature stages of electricity retail market reform. The findings indicate： （1） In the initial stage， insufficient cognition of the user group enables electricity retailers to obtain high profits through elevated quotations； regulatory focus should be on building market confidence and ensuring effective market operation. （2） In the expansion stage， as user rationality improves， electricity retailers adopt low-price strategies to capture market share； regulation should target the prevention of monopolistic behavior. （3） In the mature stage， the electricity retail market reaches a stable state of sustained growth； regulatory efforts should promote technological advancement and brand innovation.