IDEAS home Printed from https://ideas.repec.org/a/nea/journl/y2015i25p12-38.html
   My bibliography  Save this article

Linear City Models: Overview and Typology

Author

Listed:
  • Torbenko, A.

    (Kemerovo State University, Kemerovo, Russia)

Abstract

The article surveys varieties of "linear city" models, the first of which was made by H. Hotelling in 1929. Linear city models typically used for analyzing spatial competition and product differentiation. Our classification for linear city models is based on related types of oligopolistic competition. The article considers particular linear city models, also the using this models as tool for specific studies. Models with different shape of the space is also mentioned. Several stages of the models' development are identified.

Suggested Citation

  • Torbenko, A., 2015. "Linear City Models: Overview and Typology," Journal of the New Economic Association, New Economic Association, vol. 25(1), pages 12-38.
    • Handle: RePEc:nea:journl:y:2015:i:25:p:12-38
    as

    Download full text from publisher

    File URL: http://www.econorus.org/repec/journl/2015-25-12-38r.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Anas, Alex & Xu, Rong, 1999. "Congestion, Land Use, and Job Dispersion: A General Equilibrium Model," Journal of Urban Economics, Elsevier, vol. 45(3), pages 451-473, May.
    2. B. Curtis Eaton & Richard G. Lipsey, 1975. "The Principle of Minimum Differentiation Reconsidered: Some New Developments in the Theory of Spatial Competition," Review of Economic Studies, Oxford University Press, vol. 42(1), pages 27-49.
    3. Beckmann, Martin J. & Thisse, Jacques-Francois, 1987. "The location of production activities," Handbook of Regional and Urban Economics, in: P. Nijkamp (ed.), Handbook of Regional and Urban Economics, edition 1, volume 1, chapter 2, pages 21-95, Elsevier.
    4. Benson, Bruce L & Greenhut, Melvin L & Norman, George, 1990. "On the Basing-Point System," American Economic Review, American Economic Association, vol. 80(3), pages 584-588, June.
    5. Greenhut, John G & Greenhut, M L, 1975. "Spatial Price Discrimination, Competition and Locational Effects," Economica, London School of Economics and Political Science, vol. 42(168), pages 401-419, November.
    6. Jehiel, Philippe, 1992. "Product differentiation and price collusion," International Journal of Industrial Organization, Elsevier, vol. 10(4), pages 633-641, December.
    7. Pierre-Philippe Combes & Thierry Mayer & Jacques-François Thisse, 2008. "Economic Geography: The Integration of Regions and Nations," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00311000, HAL.
    8. Hamilton, Jonathan H. & Thisse, Jacques-Francois & Weskamp, Anita, 1989. "Spatial discrimination : Bertrand vs. Cournot in a model of location choice," Regional Science and Urban Economics, Elsevier, vol. 19(1), pages 87-102, February.
    9. Aguirre, Inaki & Paz Espinosa, Maria, 2004. "Product differentiation with consumer arbitrage," International Journal of Industrial Organization, Elsevier, vol. 22(2), pages 219-239, February.
    10. Gabszewicz, Jean Jaskold & Thisse, Jacques-Francois, 1986. "On the Nature of Competition with Differentiated Products," Economic Journal, Royal Economic Society, vol. 96(381), pages 160-172, March.
    11. Mayer, Thierry, 2000. "Spatial Cournot competition and heterogeneous production costs across locations," Regional Science and Urban Economics, Elsevier, vol. 30(3), pages 325-352, May.
    12. Irmen, Andreas & Thisse, Jacques-Francois, 1998. "Competition in Multi-characteristics Spaces: Hotelling Was Almost Right," Journal of Economic Theory, Elsevier, vol. 78(1), pages 76-102, January.
    13. Osborne, Martin J & Pitchik, Carolyn, 1987. "Equilibrium in Hotelling's Model of Spatial Competition," Econometrica, Econometric Society, vol. 55(4), pages 911-922, July.
    14. Chang, Myong-Hun, 1991. "The effects of product differentiation on collusive pricing," International Journal of Industrial Organization, Elsevier, vol. 9(3), pages 453-469, September.
    15. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
    16. Edward C. Prescott & Michael Visscher, 1977. "Sequential Location among Firms with Foresight," Bell Journal of Economics, The RAND Corporation, vol. 8(2), pages 378-393, Autumn.
    17. Partha Dasgupta & Eric Maskin, 1986. "The Existence of Equilibrium in Discontinuous Economic Games, I: Theory," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 53(1), pages 1-26.
    18. repec:ulb:ulbeco:2013/1759 is not listed on IDEAS
    19. Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135-135.
    20. Economides, Nicholas & Siow, Aloysius, 1988. "The Division of Markets is Limited by the Extent of Liquidity (Spatial Competition with Externalities)," American Economic Review, American Economic Association, vol. 78(1), pages 108-121, March.
    21. Thisse, Jacques-Francois & Vives, Xavier, 1988. "On the Strategic Choice of Spatial Price Policy," American Economic Review, American Economic Association, vol. 78(1), pages 122-137, March.
    22. Mohammed Kharbach, 2009. "A Unidirectional Hotelling Model," Economics Bulletin, AccessEcon, vol. 29(3), pages 1814-1819.
    23. Ralph M. Braid, 1987. "The Spatial Incidence of Local Retail Taxation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 102(4), pages 881-891.
    24. de Palma, A, et al, 1985. "The Principle of Minimum Differentiation Holds under Sufficient Heterogeneity," Econometrica, Econometric Society, vol. 53(4), pages 767-781, July.
    25. Stefano Colombo, 2009. "The unidirectional Hotelling model with spatial price discrimination," Economics Bulletin, AccessEcon, vol. 29(4), pages 3031-3040.
    26. d'Aspremont, C & Gabszewicz, Jean Jaskold & Thisse, J-F, 1979. "On Hotelling's "Stability in Competition"," Econometrica, Econometric Society, vol. 47(5), pages 1145-1150, September.
    27. Meza, Sergio & Tombak, Mihkel, 2009. "Endogenous location leadership," International Journal of Industrial Organization, Elsevier, vol. 27(6), pages 687-707, November.
    28. Economides, Nicholas, 1986. "Minimal and maximal product differentiation in Hotelling's duopoly," Economics Letters, Elsevier, vol. 21(1), pages 67-71.
    29. Nicholas Economides, 1986. "Nash Equilibrium in Duopoly with Products Defined by Two Characteristics," RAND Journal of Economics, The RAND Corporation, vol. 17(3), pages 431-439, Autumn.
    30. Mai, Chao-cheng & Peng, Shin-kun, 1999. "Cooperation vs. competition in a spatial model," Regional Science and Urban Economics, Elsevier, vol. 29(4), pages 463-472, July.
    31. Iñaki Aguirre & Ana M. Martin, 2001. "On the strategic choice of spatial price policy: the role of the pricing game rules," Economics Bulletin, AccessEcon, vol. 12(2), pages 1-7.
    32. Novshek, William, 1980. "Equilibrium in simple spatial (or differentiated product) models," Journal of Economic Theory, Elsevier, vol. 22(2), pages 313-326, April.
    33. James W. Friedman & Jacques-Francois Thisse, 1993. "Partial Collusion Fosters Minimum Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 24(4), pages 631-645, Winter.
    34. Benson, Bruce L & Greenhut, Melvin L & Norman, George, 1990. "On the Basing-Point System: Reply," American Economic Review, American Economic Association, vol. 80(4), pages 963-967, September.
    35. Wang, Ping, 1993. "Agglomeration in a linear city with heterogeneous households," Regional Science and Urban Economics, Elsevier, vol. 23(2), pages 291-306, April.
    36. James J. Anton & Paul J. Gertler, 2004. "Regulation, Local Monopolies and Spatial Competition," Journal of Regulatory Economics, Springer, vol. 25(2), pages 115-141, March.
    37. Stefano Colombo, 2009. "Firms' symmetry and sustainability of collusion in a Hotelling duopoly," Economics Bulletin, AccessEcon, vol. 29(1), pages 338-346.
    38. Soper, Jean B, et al, 1991. "Basing Point Pricing and Production Concentration," Economic Journal, Royal Economic Society, vol. 101(406), pages 539-556, May.
    39. Stefano Colombo, 2009. "Sustainability of collusion with imperfect price discrimination and inelastic demand functions," Economics Bulletin, AccessEcon, vol. 29(3), pages 1687-1694.
    40. Kolstad Charles D., 1994. "Hotelling Rents in Hotelling Space: Product Differentiation in Exhaustible Resource Markets," Journal of Environmental Economics and Management, Elsevier, vol. 26(2), pages 163-180, March.
    41. Kai Andree & Juljana Calaki, 2011. "Product differentiation in a spatial Cournot model with asymmetric demand," Economics Bulletin, AccessEcon, vol. 31(2), pages 1125-1130.
    42. Jonathan Vogel, 2008. "Spatial Competition with Heterogeneous Firms," Journal of Political Economy, University of Chicago Press, vol. 116(3), pages 423-466, June.
    43. Hongbin Cai & Uday Rajan, 2005. "Incentive Compatible Collusion and Investment," Annals of Economics and Finance, Society for AEF, vol. 6(1), pages 37-52, May.
    44. Kai Andree, 2011. "Product differentiation and spatial agglomeration in a unidirectional Cournot model," Letters in Spatial and Resource Sciences, Springer, vol. 4(3), pages 167-172, October.
    45. Miren Lafourcade & Jacques-François Thisse, 2008. "New economic geography: A guide to transport analysis," Working Papers halshs-00586878, HAL.
    46. Anderson, Simon P & Neven, Damien J, 1991. "Cournot Competition Yields Spatial Agglomeration," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 32(4), pages 793-808, November.
    47. Gal-or, Esther, 1982. "Hotelling's spatial competition as a model of sales," Economics Letters, Elsevier, vol. 9(1), pages 1-6.
    48. Economides, Nicholas, 1984. "The principle of minimum differentiation revisited," European Economic Review, Elsevier, vol. 24(3), pages 345-368, April.
    49. José María Chamorro Rivas, 2000. "Spatial dispersion in cournot competition," Spanish Economic Review, Springer;Spanish Economic Association, vol. 2(2), pages 145-152.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wen-Jung Liang & Yen-Ju Lin & Hong Hwang, 2012. "Heterogeneous duopoly, spatially discriminatory pricing, and optimal location," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 49(3), pages 845-860, December.
    2. Ralph Braid, 2014. "The socially optimal and equilibrium locations of two stores or libraries with consumer search," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 53(1), pages 123-136, August.
    3. Matsumura, Toshihiro & Shimizu, Daisuke, 2005. "Spatial Cournot competition and economic welfare: a note," Regional Science and Urban Economics, Elsevier, vol. 35(6), pages 658-670, November.
    4. Ricardo Biscaia & Isabel Mota, 2013. "Models of spatial competition: A critical review," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 851-871, November.
    5. Stefano Colombo, 2016. "A Model of Three Cities," International Regional Science Review, , vol. 39(4), pages 386-416, October.
    6. Gupta, Barnali & Lai, Fu-Chuan & Pal, Debashis & Sarkar, Jyotirmoy & Yu, Chia-Ming, 2004. "Where to locate in a circular city?," International Journal of Industrial Organization, Elsevier, vol. 22(6), pages 759-782, June.
    7. Aguirre, Inaki & Paz Espinosa, Maria, 2004. "Product differentiation with consumer arbitrage," International Journal of Industrial Organization, Elsevier, vol. 22(2), pages 219-239, February.
    8. Ching‐Chih Tseng & Wen‐Jung Liang & Kuang‐Cheng Andy Wang, 2010. "Spatial agglomeration with vertical differentiation," Papers in Regional Science, Wiley Blackwell, vol. 89(4), pages 841-858, November.
    9. Stefano Colombo, 2016. "Location choices with a non-linear demand function," Papers in Regional Science, Wiley Blackwell, vol. 95, pages 215-226, March.
    10. Noriaki Matsushima & Toshihiro Matsumura, 2003. "Mixed oligopoly and spatial agglomeration," Canadian Journal of Economics, Canadian Economics Association, vol. 36(1), pages 62-87, February.
    11. Buechel, Berno & Roehl, Nils, 2015. "Robust equilibria in location games," European Journal of Operational Research, Elsevier, vol. 240(2), pages 505-517.
    12. Matsumura, Toshihiro & Matsushima, Noriaki, 2011. "Collusion, agglomeration, and heterogeneity of firms," Games and Economic Behavior, Elsevier, vol. 72(1), pages 306-313, May.
    13. Ralph Braid, 2013. "The locations of firms on intersecting roadways," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 50(3), pages 791-808, June.
    14. Firgo, Matthias & Kügler, Agnes, 2018. "Cooperative pricing in spatially differentiated markets," Regional Science and Urban Economics, Elsevier, vol. 73(C), pages 51-67.
    15. Heijnen, Pim & Soetevent, Adriaan R., 2018. "Price competition on graphs," Journal of Economic Behavior & Organization, Elsevier, vol. 146(C), pages 161-179.
    16. Kuangnen Cheng & Hui-Ping Chen & Jason Lee, 2015. "Competition behavior in service frequency for U.S. airlines," Service Business, Springer;Pan-Pacific Business Association, vol. 9(1), pages 1-16, March.
    17. Gaëtan Fournier & Marco Scarsini, 2014. "Hotelling Games on Networks: Efficiency of Equilibria," Documents de travail du Centre d'Economie de la Sorbonne 14033, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    18. BACCHIEGA, Emmanuele & MINNITI, Antonio, 2005. "Location in a vertically differentiated industry," LIDAM Discussion Papers CORE 2005071, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    19. Ellis, Christopher J. & Silva, Emilson C. D., 1998. "British Bus Deregulation: Competition and Demand Coordination," Journal of Urban Economics, Elsevier, vol. 43(3), pages 336-361, May.
    20. Stefano Colombo, 2009. "The unidirectional Hotelling model with spatial price discrimination," Economics Bulletin, AccessEcon, vol. 29(4), pages 3031-3040.

    More about this item

    Keywords

    spatial competition; product differentiation; linear city model; Hotelling;
    All these keywords.

    JEL classification:

    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nea:journl:y:2015:i:25:p:12-38. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Alexey Tcharykov (email available below). General contact details of provider: https://edirc.repec.org/data/nearuea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.