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On cost restrictions in spatial competition models with heterogeneous firms

Author

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  • Alderighi, Marco
  • Piga, Claudio A.

Abstract

This paper investigates the properties of two types of cost restrictions that guarantee the existence of an equilibrium in pure strategies in Bayesian spatial competition models with heterogeneous firms.

Suggested Citation

  • Alderighi, Marco & Piga, Claudio A., 2010. "On cost restrictions in spatial competition models with heterogeneous firms," Economics Letters, Elsevier, vol. 108(1), pages 40-42, July.
  • Handle: RePEc:eee:ecolet:v:108:y:2010:i:1:p:40-42
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    References listed on IDEAS

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    1. Eaton, B Curtis & Lipsey, Richard G, 1978. "Freedom of Entry and the Existence of Pure Profit," Economic Journal, Royal Economic Society, vol. 88(351), pages 455-469, September.
    2. Alderighi, Marco & Piga, Claudio A., 2010. "On cost restrictions in spatial competition models with heterogeneous firms," Economics Letters, Elsevier, vol. 108(1), pages 40-42, July.
    3. Marco Alderighi & Claudio A. Piga, 2008. "The Circular City with Heterogeneous Firms," Discussion Paper Series 2008_03, Department of Economics, Loughborough University, revised Jul 2008.
    4. Chad Syverson, 2004. "Market Structure and Productivity: A Concrete Example," Journal of Political Economy, University of Chicago Press, vol. 112(6), pages 1181-1222, December.
    5. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
    6. Jonathan Vogel, 2008. "Spatial Competition with Heterogeneous Firms," Journal of Political Economy, University of Chicago Press, vol. 116(3), pages 423-466, June.
    7. d'Aspremont, C & Gabszewicz, Jean Jaskold & Thisse, J-F, 1979. "On Hotelling's "Stability in Competition"," Econometrica, Econometric Society, pages 1145-1150.
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    Cited by:

    1. Matthew Beacham, 2012. "The effect of Stackelberg cost reductions on spatial competition with heterogeneous firms," Discussion Papers 12/14, Department of Economics, University of York.
    2. Alderighi, Marco & Piga, Claudio A., 2010. "On cost restrictions in spatial competition models with heterogeneous firms," Economics Letters, Elsevier, vol. 108(1), pages 40-42, July.

    More about this item

    Keywords

    Localized competition Cost heterogeneity;

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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