Spatial competition between shopping centers

Antonio Brandao, Joao Correia-da-Silva and Joana Pinho

Journal of Mathematical Economics, 2014, vol. 50, issue C, 234-250

Abstract: We study competition between two shopping centers that sell the same set of goods and are located at the extremes of a linear city, without restricting consumers to make all their purchases at a single place. In the case of competition between a shopping mall (set of independent single-product shops) and a department store (single multiproduct shop), we find that: if the number of goods is low, all consumers shop at a single place; if it is moderately high, some consumers travel to both shopping centers to buy each good where it is cheaper (a single good is cheaper at the shopping mall). The shops at the mall, taken together, obtain a lower profit than the department store. Nevertheless, two shopping malls should be expected to appear endogenously.

Keywords: Multiproduct firms; Spatial competition; Two-stop shopping (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (6)

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Working Paper: Spatial competition between shopping centers (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:mateco:v:50:y:2014:i:c:p:234-250

DOI: 10.1016/j.jmateco.2013.09.002

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