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On cost restrictions in spatial competition models with heterogeneous firms

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Abstract

This paper investigates the properties of two types of cost restrictions that guarantee the existence of an equilibrium in pure strategies in Bayesian spatial competition models with heterogenous firms.

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  • Marco Alderighi & Claudio A. Piga, 2009. "On cost restrictions in spatial competition models with heterogeneous firms," Discussion Paper Series 2009_09, Department of Economics, Loughborough University, revised Jul 2009.
    • Handle: RePEc:lbo:lbowps:2009_09
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    File URL: http://www.lboro.ac.uk/departments/sbe/RePEc/lbo/lbowps/WP_cost_restrictions_2009_09.pdf
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    References listed on IDEAS

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    1. Marco Alderighi & Claudio A. Piga, 2008. "The Circular City with Heterogeneous Firms," Discussion Paper Series 2008_03, Department of Economics, Loughborough University, revised Jul 2008.
    2. Chad Syverson, 2004. "Market Structure and Productivity: A Concrete Example," Journal of Political Economy, University of Chicago Press, vol. 112(6), pages 1181-1222, December.
    3. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
    4. 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.
    5. Eaton, B Curtis & Lipsey, Richard G, 1978. "Freedom of Entry and the Existence of Pure Profit," Economic Journal, Royal Economic Society, vol. 88(351), pages 455-469, September.
    6. Alderighi, Marco & Piga, Claudio A., 2010. "On cost restrictions in spatial competition models with heterogeneous firms," Economics Letters, Elsevier, vol. 108(1), pages 40-42, July.
    7. Philippe Aghion & Mark Schankerman, 2004. "On the welfare effects and political economy of competition-enhancing policies," Economic Journal, Royal Economic Society, vol. 114(498), pages 800-824, October.
    8. Jonathan Vogel, 2008. "Spatial Competition with Heterogeneous Firms," Journal of Political Economy, University of Chicago Press, vol. 116(3), pages 423-466, June.
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    Cited by:

    1. Matthew Beacham, 2012. "The effect of Stackelberg cost reductions on spatial competition with heterogeneous firms," Discussion Papers 12/14, Department of Economics, University of York.
    2. Alderighi, Marco & Piga, Claudio A., 2010. "On cost restrictions in spatial competition models with heterogeneous firms," Economics Letters, Elsevier, vol. 108(1), pages 40-42, July.
    3. Nava, Consuelo R. & Meleo, Linda & Cassetta, Ernesto & Morelli, Giovanna, 2018. "The impact of the EU-ETS on the aviation sector: Competitive effects of abatement efforts by airlines," Transportation Research Part A: Policy and Practice, Elsevier, vol. 113(C), pages 20-34.

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    More about this item

    Keywords

    Localized competition; market effciency; cost heterogeneity.;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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