On Modeling Transport Costs
AbstractThe interpretation of the loss of utility as transport costs in address models of differentiation poses a methodological difficulty. Transport costs implicitly amounts to assume that there is a good neither included in the differentiated sector nor in the composite (numeraire) good of the economy. We propose to use iceberg-type transport costs to solve this difficulty.
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Bibliographic InfoPaper provided by Barcelona Graduate School of Economics in its series Working Papers with number 277.
Date of creation: Apr 2006
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Spatial competition; iceberg transport costs; monopoly;
Find related papers by JEL classification:
- L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
- D42 - Microeconomics - - Market Structure and Pricing - - - Monopoly
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