Do we go shopping downtown or in the 'burbs? Why not both?
Philip Ushchev (),
Igor Sloev and
Jacques Thisse ()
ERSA conference papers from European Regional Science Association
We combine spatial and monopolistic competition to study market interactions between downtown retailers and an outlying shopping mall. Consumers shop at either marketplace or at both, and buy each variety in volume. The market solution stems from the interplay between the market expansion eff_x001B_ect generated by consumers seeking more opportunities, and the competition eff_x001B_ect. Firms' profi_x001C_ts increase (decrease) with the entry of local competitors when the former (latter) dominates. Downtown retailers swiftly vanish when the mall is large. A predatory but effi_x001E_cient mall need not be regulated, whereas the regulator must restrict the size of a mall accommodating downtown retailers.
Keywords: shopping behavior; retailers; shopping mall; spatial competition; monopolistic competition (search for similar items in EconPapers)
JEL-codes: D43 L81 R10 (search for similar items in EconPapers)
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Working Paper: Do we go shopping downtown or in the ‘burbs’? Why not both? (2013)
Working Paper: Do we go shopping downtown or in the `burbs? Why not both? (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:wiw:wiwrsa:ersa14p1262
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