Demand and location decision of a monopsonistic firm
This paper examines the impact of demand on the location decision of a monopsonistic firm in the Weber-Moses triangle with one output and two inputs. When the distance of the plant location from the product market is held constant and the expansion path is linear through the origin, the analysis shows that as demand for output increases, the monopsonist has an incentive to move the plant away from the monopsonized input market and towards other markets. When the distance of the plant location from the product market is a choice variable, the linearly homogeneous production function is not sufficient to ensure that the location decision of the monopsonistic firm is independent of the demand function. These results differ significantly from the well-established results in location theory where the firm is a price taker in all the input markets.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 31 (1997)
Issue (Month): 3 ()
|Note:||Received: February 1996 / Accepted in revised form: September 1996|
|Contact details of provider:|| Web page: http://www.springer.com|
|Order Information:||Web: http://link.springer.com/journal/168|
When requesting a correction, please mention this item's handle: RePEc:spr:anresc:v:31:y:1997:i:3:p:273-284. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.