In a two-region economy, two upstream firms supply an input to two consumer goods firms. For two different location patterns (site specificity and co-location of the suppliers), the firms play a three-stage game: the input suppliers select transport rates; then they choose outputs; finally the buyers select quantities of the consumer good. It is concluded that the site specificity of the input leads to a high transport cost and to its specialized adaptation to the needs of the local user.
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Paper provided by Department of Economics at the School of Economics and Management (ISEG), Technical University of Lisbon. in its series Working Papers with number
2005/01.
Length: Date of creation: 2005 Date of revision: Handle: RePEc:ise:isegwp:wp12005
Contact details of provider: Postal: Department of Economics, School of Economics and Management (ISEG), Technical University of Lisbon, Rua do Quelhas 6, 1200-781 LISBON, PORTUGAL Web page: http://www.iseg.utl.pt/departamentos/economia/
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Find related papers by JEL classification: D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection R12 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
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Cited by: (explanations, 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.)
José Pedro Pontes, 2006.
"Networks and Firm Location,"
Working Papers
2006/09, Department of Economics at the School of Economics and Management (ISEG), Technical University of Lisbon..
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