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Models à La Lancaster and à La Hoteling: When they are the same

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  • Martin Peitz

    (Universidad de Alicante)

Abstract

Consumer behavior in differentiated product markets can be specified following the Lancastriancharacteristics approach or following Hotelling´s approach of spatial competition. In the case ofunit demand I present a class of models of (heterogeneous) consumer behavior which can bewritten as models à la Lancaster as well as models à la Hotelling.

Suggested Citation

  • Martin Peitz, 1997. "Models à La Lancaster and à La Hoteling: When they are the same," Working Papers. Serie AD 1997-02, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    • Handle: RePEc:ivi:wpasad:1997-02
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    File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-1997-02.pdf
    File Function: Fisrt version / Primera version, 1997
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    References listed on IDEAS

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    1. G. C. Archibald & B. Curtis Eaton, 1989. "Two Applications of Characteristics Theory," Palgrave Macmillan Books, in: George R. Feiwel (ed.), The Economics of Imperfect Competition and Employment, chapter 12, pages 409-436, Palgrave Macmillan.
    2. Friedman, James, 1993. "Oligopoly theory," Handbook of Mathematical Economics, in: K. J. Arrow & M.D. Intriligator (ed.), Handbook of Mathematical Economics, edition 4, volume 2, chapter 11, pages 491-534, Elsevier.
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    4. Caplin, Andrew & Nalebuff, Barry, 1991. "Aggregation and Imperfect Competition: On the Existence of Equilibrium," Econometrica, Econometric Society, vol. 59(1), pages 25-59, January.
    5. 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.
    6. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
    7. ANDERSON, Simon P. & de PALMA, André & THISSE, Jacques-François, 1992. "Interpretations of the logit discrete choice models and the theory of product differentiation," LIDAM Reprints CORE 1017, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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    2. Didier Laussel, 2018. "Strategic Product Design under Duopoly," Annals of Economics and Statistics, GENES, issue 131, pages 25-44.

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    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory

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