I develop a simple Hotelling model which corresponds the distribution of consumer preferences to the intensity of competition. This is a new perspective on consumer distribution in the Hotelling model. I impose two properties, the mean preserving spread (MPS) and monotone likelihood ratio property (MLRP), on distribution functions. These properties provide a way to measure the intensity of competition in Hotelling model. This approach sheds a new light on various issues. Non-uniform distributions can play a significant role in reversing well-known results that the uniform distribution has revealed or in discovering unknown results that the uniform distribution could not demonstrate. As examples, I study three issues such as incentives to innovate, the preference based price discrimination, and the value of information.
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number
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