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Spatial competition with profit-maximising and labour-managed firms (2001)

Lambertini, Luca

Oxford, UK : Blackwell Publishing Ltd

Papers in regional science 80 (2001), S. 0

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ISSN: 1435-5957

Source: Blackwell Publishing Journal Backfiles 1879-2005

Topics: Geography , Economics

Notes: Abstract The nature of the equilibria arising under spatial differentiation is investigated here in a duopoly model, where at least one firm maximises value added per worker. The study shows that if firms’objectives differ, there exists a subgame perfect equilibrium in pure strategies, which is possibly characterised by asymmetric locations. If both firms are labour-managed, there exists a (symmetric) subgame perfect equilibrium in pure strategies with firms located at the first and third quartiles, if and only if the setup cost is low enough. Otherwise, undercutting is profitable.

Type of Medium: Electronic Resource

URL: http://dx.doi.org/10.1111/j.1435-5597.2001.tb01216.x

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