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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

    as
    1. 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.
    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.
    3. labbe, M. & Peeters, D. & Thisse, J.F., 1992. "Location on Networks," Papers 9216, Universite Libre de Bruxelles - C.E.M.E..
    4. 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.
    5. Caplin, Andrew & Nalebuff, Barry, 1991. "Aggregation and Imperfect Competition: On the Existence of Equilibrium," Econometrica, Econometric Society, vol. 59(1), pages 25-59, January.
    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).
    8. repec:crs:wpaper:8801 is not listed on IDEAS
    9. W. M. Gorman, 1980. "A Possible Procedure for Analysing Quality Differentials in the Egg Market," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(5), pages 843-856.
    10. John R. Hauser, 1988. "Note—Competitive Price and Positioning Strategies," Marketing Science, INFORMS, vol. 7(1), pages 76-91.
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    Cited by:

    1. Didier Laussel, 2018. "Strategic Product Design under Duopoly," Annals of Economics and Statistics, GENES, issue 131, pages 25-44.

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    More about this item

    Keywords

    Product differenciation; characteristics approach;

    JEL classification:

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

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