The generalized circular model
AbstractIn this paper we present a generalization of the circular model. In this model there are two concentric circular markets, which enables us to study two types of markets simultaneously. There are switching costs involved for moving from one circle to the other circle, which can also be thought of as transformation costs. Consumers have valuations for the product of the firms, depending on the circle they live on. Equilibrium prices then of course are affected by both switching costs and consumers' valuations. An interesting insight that comes from this approach is that an extension of the circular model may invalidate the familiar principle that free entry is characterized by too many firms. Furthermore we discuss the effect of introducing reservation prices on the equilibrium outcome using a constructive approach.
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 InfoPaper provided by Tilburg University, Faculty of Economics and Business Administration in its series Research Memorandum with number 685.
Date of creation: 1995
Date of revision:
Contact details of provider:
Web page: http://www.tilburguniversity.edu/nl/over-tilburg-university/schools/economics-and-management/
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.:
- Webers, H.M., 1994. "The location model with two periods of price competition," Research Memorandum 663, Tilburg University, Faculty of Economics and Business Administration.
- Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
- Hamilton, J.H. & Macleod, W.B. & Thisse, J-F., 1988.
"Spacial Competition And The Core,"
UFAE and IAE Working Papers
110-89, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- HAMILTON, John H. & MacLEOD, W. Bentley & THISSE, Jacques-François, . "Spatial competition and the core," CORE Discussion Papers RP -986, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Jonathan H. Hamilton & W. Bentley MacLeod, 1987. "Spatial Competition and the Core," Working Papers 704, Queen's University, Department of Economics.
- Hamilton, J.H. & Macleod, W.P. & Thisse, J.F., 1988. "Spatial Competition And The Core," Papers 88-6, Florida - College of Business Administration.
- Webers, H.M., 1994. "The location model with two periods of price competition," Discussion Paper 1994-68, Tilburg University, Center for Economic Research.
- Boyer, Marcel & Moreaux, Michel, 1993. "Strategic market coverage in spatial competition," International Journal of Industrial Organization, Elsevier, vol. 11(3), pages 299-326, September.
- Webers, H.M., 1996. "Competition in Spatial Location Models," Open Access publications from Tilburg University urn:nbn:nl:ui:12-73591, Tilburg University.
- Raalte, C.L.J.P. van & Webers, H.M., 1995. "Spatial competition with intermediated matching," Research Memorandum 702, Tilburg University, Faculty of Economics and Business Administration.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Richard Broekman).
If references are entirely missing, you can add them using this form.