Collusion, agglomeration, and heterogeneity of firms

Toshihiro Matsumura and Noriaki Matsushima

Games and Economic Behavior, 2011, vol. 72, issue 1, 306-313

Abstract: Jehiel (1992) and Friedman and Thisse (1993) show that spatial agglomeration appears in a standard two-stage location price model if symmetric firms collude in prices. We introduce a cost difference between two firms. We show that agglomeration never appears in a collusive equilibrium even when the cost difference between firms is sufficiently small.

Keywords: Cost; asymmetry; Spatial; agglomeration; Collusion (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (6)

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Related works:
Working Paper: Collusion, Agglomeration, and Heterogeneity of Firms (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:72:y:2011:i:1:p:306-313

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