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Spatial Pricing, Spatial Rents, and Spatial Welfare

Timothy Gronberg () and Jack Meyer ()

The Quarterly Journal of Economics, 1982, vol. 97, issue 4, 633-644

Abstract: This paper presents a model of spatial equilibrium that integrates elements of spatial pricing and Thünen location models. Properties of equilibrium under mill, uniform, and discriminatory pricing regimes are explored. Three comparative propositions concerning firm, consumer, and landowner welfare that obtain under the alternative pricing schemes are presented. The welfare findings contrast with those found in the extant spatial pricing literature. In particular, the superiority of mill pricing from a consumer welfare perspective is questioned.

Date: 1982
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The Quarterly Journal of Economics is currently edited by Robert J. Barro, Lawrence F. Katz, Nathan Nunn, Andrei Shleifer and Stefanie Stantcheva

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