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Market structure and industry location in a footloose capital model

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  • Fujiwara, Kenji

Abstract

Comparison among Cournot, Bertrand and monopolistic competition receives recent attention in industrial organization, but not in New Economic Geography. To fulfill this gap, we examine how the difference in market structures affects industry location in a footloose capital model. We find that the home market effect is strongest in Cournot competition, second strongest in Bertrand competition, and weakest in monopolistic competition. And, we link the insights in industrial organization with our model of geography.

Suggested Citation

  • Fujiwara, Kenji, 2023. "Market structure and industry location in a footloose capital model," Research in Economics, Elsevier, vol. 77(2), pages 275-283.
    • Handle: RePEc:eee:reecon:v:77:y:2023:i:2:p:275-283
    DOI: 10.1016/j.rie.2022.11.001
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    More about this item

    Keywords

    Cournot competition; Bertrand competition; Monopolistic competition; Home market effect;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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