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Spatial competition with concave transport costs

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URI: https://hdl.handle.net/10016/4302
ISSN: 0166-0462
DOI: 10.1016/S0166-0462(01)00094-1
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spatial_RSUE_2002_ps.pdf (328.92 KB)
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2002-07
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Elsevier
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Abstract
We study the location-then-price game played by two firms in a circular market when consumers face non-linear transport costs. We show that for any convex transport cost function there exists a concave one such that the location-then-price games induced by these functions are strategically equivalent. Further, we provide a sufficient condition to guarantee that a similar equivalence result holds under oligopolistic competition among equidistant firms.
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Spatial competition, Equilibria, Oligopoly
Bibliographic citation
Regional Science and Urban Economics. 2002, vol. 32, nº 4, p. 531–540
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