On large market asymptotics for spatial price competition models

Taisuke Otsu and Keita Sunada

Economics Letters, 2024, vol. 234, issue C

Abstract: In spatial price competition models, demand factors have correlation with prices through the markup so that their identification power decreases as the number of product grows. Asymptotic results indicate lack of consistency of the estimator due to weak instruments.

Keywords: Spatial price competition; Weak instruments (search for similar items in EconPapers)
JEL-codes: C13 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:234:y:2024:i:c:s0165176523004949

DOI: 10.1016/j.econlet.2023.111468

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