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Existence of pure strategy equilibria among geographically dispersed firms

Author

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  • Raphael Thomadsen

    (UCLA, Anderson School of Business)

Abstract

This paper gives a proof of existence of price equilibria under certain parameters for a model of product differentiation commonly used in the empirical geographic differentiation literature. This proof is needed because the assumptions of Caplin and Nalebuff (1991) are not generally satisfied once data is introduced to geographic models. The theorem also has implications for existence in mixed-logit demand models.

Suggested Citation

  • Raphael Thomadsen, 2005. "Existence of pure strategy equilibria among geographically dispersed firms," Economics Bulletin, AccessEcon, vol. 12(12), pages 1-4.
    • Handle: RePEc:ebl:ecbull:eb-04l10042
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    File URL: http://www.accessecon.com/pubs/EB/2005/Volume12/EB-04L10042A.pdf
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    References listed on IDEAS

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    1. Peter Davis, 2006. "Spatial competition in retail markets: movie theaters," RAND Journal of Economics, RAND Corporation, vol. 37(4), pages 964-982, December.
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    Cited by:

    1. Chung‐seung Lee & Metin Çakanyildirim, 2021. "Price Competition Under Mixed Multinomial Logit Demand: Sufficiency Conditions for Validating the Model," Production and Operations Management, Production and Operations Management Society, vol. 30(9), pages 3272-3283, September.
    2. Ruben van de Geer & Arnoud V. den Boer, 2022. "Price Optimization Under the Finite-Mixture Logit Model," Management Science, INFORMS, vol. 68(10), pages 7480-7496, October.

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    More about this item

    Keywords

    Differentiated products;

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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