IDEAS home Printed from https://ideas.repec.org/a/bpj/bejtec/v23y2023i2p639-662n5.html
   My bibliography  Save this article

An Urban Configuration with Online Competition

Author

Listed:
  • Lai Fu-Chuan

    (Academia Sinica, Research Center for Humanities and Social Sciences, Nankang, Taipei, 11529, Taiwan)

Abstract

This paper introduces the impact of online competition to analysis of the urban configuration of a small open city, which was first developed by Alonso (1964. Location and Land Use. Cambridge: Harvard University Press), Mills (1967. “An Aggregative Model of Resource Allocation in a Metropolitan Area.” The American Economic Review 57 (2): 197–210), and Muth (1969. Cities and Housing. Chicago: University of Chicago Press) (AMM hereafter). In comparison to a revised AMM model in Lai and Tsai (2008. “Simplified Alonso-Mills-Muth Model with a Monopoly Vendor.” Journal of Urban Economics 63 (2): 536–43) which assumed a monopoly vendor, the present paper’s online entry brings competition, eventually causes price reduction, city expansion, and asymmetrically ascending land rent, and makes the incumbent vendor relocate to a more remote city boundary. When the disadvantage of online purchasing is not large, the urban configuration demonstrates that most residents purchase online, and only the residents living near the physical vendor make shopping trips. Finally, the benefit of city expansion from online competition eventually goes to the absentee landowners by way of the raised land rents.

Suggested Citation

  • Lai Fu-Chuan, 2023. "An Urban Configuration with Online Competition," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 23(2), pages 639-662, June.
    • Handle: RePEc:bpj:bejtec:v:23:y:2023:i:2:p:639-662:n:5
    DOI: 10.1515/bejte-2022-0017
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/bejte-2022-0017
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/bejte-2022-0017?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    urban configuration; location; online competition; AMM models; retailers;
    All these keywords.

    JEL classification:

    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:bejtec:v:23:y:2023:i:2:p:639-662:n:5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.