Spatial Cournot Oligopoly with Vertical Linkages

André Barreira da Silva Rocha () and José Pontes

No 2005/11, Working Papers Department of Economics from ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa

Abstract: This paper examines the equilibrium of location of N vertically-linked firms. In a spatial economy composed of two regions, a monopolist firm supplies an input to N consumer goods firms that compete in quantities. It was concluded that, when there are increases in the transport cost of the input, downstream firms prefer to agglomerate in the region where the upstream firm is located, in order to obtain savings in the production cost. On the other hand, increases in the general transport cost or in the number of downstream firms lead to a dispersion of these firms, in order to reduce competition and locate closer to the final consumer.

Keywords: Agglomeration; Intermediate Goods; Spatial Oligopoly. (search for similar items in EconPapers)
JEL-codes: C72 L13 R30 (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-com, nep-geo, nep-ind, nep-mic and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ise:isegwp:wp112005

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