Spatial dispersion in cournot competition

José María Chamorro Rivas ()

Spanish Economic Review, 2000, vol. 2, issue 2, 145-152

Abstract: This paper considers the spatial model used by Anderson and Neven (1991) to study firms' decisions on locations without restricting the consumers' reservation price. We note that the pattern of locations varies as the reservation price for a fixed transportation rate decreases. For a high enough reservation price, we find Anderson and Neven (1991)'s result where firms group at the center of the market and serve all consumers. As the reservation price falls, firms start to move away from each other, increasing the quantities shipped to the consumers close to their locations.

Keywords: Price discrimination; cournot competition; spatial dispersion; duopoly; subgame perfect equilibrium (search for similar items in EconPapers)
JEL-codes: L13 (search for similar items in EconPapers)
Date: 2000-09-20
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Citations: View citations in EconPapers (26)

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