A synthesis of location models
AbstractThis article considers a model of spatial competition where firms and consumers are located in a semicircular space rather than in the whole circle (Salop's model) or the linear city (Hotelling's model), under the assumptions of both, convex and concave, transportation costs. The paper tries to generalize the results of the two previous models. We find that for concave transportation costs the existence of a price equilibrium is warranted for every firms' location when the length of the semicircular space is greater than 3/4. For the convex case, perfect equilibrium is only obtained when the size of the market segment is equivalent to Hotelling's linear model.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 3 (2007)
Issue (Month): 30 ()
Contact details of provider:
Find related papers by JEL classification:
- C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
- D4 - Microeconomics - - Market Structure and Pricing
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- de Frutos, M. A. & Hamoudi, H. & Jarque, X., 2002. "Spatial competition with concave transport costs," Regional Science and Urban Economics, Elsevier, vol. 32(4), pages 531-540, July.
- Hamid Hamoudi & María J. Moral, 2005. "Equilibrium existence in the linear model: Concave versus convex transportation costs," Papers in Regional Science, Wiley Blackwell, vol. 84(2), pages 201-219, 06.
- d'Aspremont, C & Gabszewicz, Jean Jaskold & Thisse, J-F, 1979.
"On Hotelling's "Stability in Competition","
Econometric Society, vol. 47(5), pages 1145-50, September.
- Anderson, Simon P, 1988.
"Equilibrium Existence in the Linear Model of Spatial Competition,"
London School of Economics and Political Science, vol. 55(220), pages 479-91, November.
- Anderson, S., 1986. "Equilibrium existence in the linear model of spatial competition," CORE Discussion Papers 1986013, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- de Frutos, M. A. & Hamoudi, H. & Jarque, X., 1999. "Equilibrium existence in the circle model with linear quadratic transport cost," Regional Science and Urban Economics, Elsevier, vol. 29(5), pages 605-615, September.
- Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
- Economides, Nicholas, 1986. "Minimal and maximal product differentiation in Hotelling's duopoly," Economics Letters, Elsevier, vol. 21(1), pages 67-71.
- GABSZEWICZ, Jean J. & THISSE, Jacques-François, .
"On the nature of competition with differentiated products,"
CORE Discussion Papers RP
-685, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Gabszewicz, Jean Jaskold & Thisse, Jacques-Francois, 1986. "On the Nature of Competition with Differentiated Products," Economic Journal, Royal Economic Society, vol. 96(381), pages 160-72, March.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (John P. Conley).
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.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.