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Concurrence en catalogue dans le duopole d'Hotelling

  • Pierre Fleckinger
  • Thierry Lafay

We study a duopoly on a market with horizontal differentiation where firms compete in catalog : firms choose a price and a location in the consumer’ space. Whereas there is no equilibrium in pure strategy for the simultaneous game, we show that an equilibrium always exists in a sequential competition. In this subgame perfect equilibrium the leader chooses a more specific product at a lower price than the follower. Thus the leader earns finally less than the follower. This introduces a tension between the temptation of attrition, which leads to an unstable configuration, and the will to guarantee a stricly positive profit. Classification JEL : L11, H41, D43, M3.

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Article provided by Presses de Sciences-Po in its journal Revue économique.

Volume (Year): 57 (2006)
Issue (Month): 3 ()
Pages: 573-581

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Handle: RePEc:cai:recosp:reco_573_0573
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  1. Anderson, S., 1986. "Spatial competition and price leadership," CORE Discussion Papers 1986002, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. MacLeod, W. Bentley, 1985. "On the non-existence of equilibria in differentiated product models," Regional Science and Urban Economics, Elsevier, vol. 15(2), pages 245-262, June.
  3. Economides, Nicholas, 1984. "The principle of minimum differentiation revisited," European Economic Review, Elsevier, vol. 24(3), pages 345-368, April.
  4. d'Aspremont, C & Gabszewicz, Jean Jaskold & Thisse, J-F, 1979. "On Hotelling's "Stability in Competition"," Econometrica, Econometric Society, vol. 47(5), pages 1145-50, September.
  5. Gotz, Georg, 2005. "Endogenous sequential entry in a spatial model revisited," International Journal of Industrial Organization, Elsevier, vol. 23(3-4), pages 249-261, April.
  6. Hinloopen, Jeroen & van Marrewijk, Charles, 1999. "On the limits and possibilities of the principle of minimum differentiation1," International Journal of Industrial Organization, Elsevier, vol. 17(5), pages 735-750, July.
  7. Bester, Helmut & de Palma, Andre & Leininger, Wolfgang & Thomas, Jonathan & von Thadden, Ernst-Ludwig, 1996. "A Noncooperative Analysis of Hotelling's Location Game," Games and Economic Behavior, Elsevier, vol. 12(2), pages 165-186, February.
  8. Nicholas Economides & Jamie Howell & Sergio Meza, 2002. "Does it Pay to be First? Sequential Locational Choice and Foreclosure," Working Papers 02-19, New York University, Leonard N. Stern School of Business, Department of Economics.
  9. Neven, Damien J., 1987. "Endogenous sequential entry in a spatial model," International Journal of Industrial Organization, Elsevier, vol. 5(4), pages 419-434.
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