Regional restriction, strategic delegation, and welfare

Arbeitspapier

We investigate the effects of restricting locations of firms into Hotelling duopoly models. In the standard location-price models, the equilibrium distance between firms is too large from the viewpoint of consumer welfare. Thus, restricting locations of firms and reducing the distance between firms improve consumer welfare, through lower prices and smaller transportation costs for consumers. We introduce strategic reward contracts into the location-price models. We find that in contrast to the above existing result, restriction of the locations of firms reduces consumer welfare. Restricting locations of the firms reduces transportation costs but increases the prices through the change of strategic commitments by the firms, and it yields a counterintuitive result.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: ISER Discussion Paper ; No. 761

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Regional Government Analysis: Land Use and Other Regulations ; Other Spatial Production and Pricing Analysis ; Oligopoly and Other Imperfect Markets
• Thema: product selection ; delegation ; Hotelling ; locational restriction ; Betriebliche Standortwahl ; Hotelling-Modell ; Wohlfahrtsanalyse ; Duopol ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Matsumura, Toshihiro ; Matsushima, Noriaki
• Ereignis: Veröffentlichung
• (wer): Osaka University, Institute of Social and Economic Research (ISER)
• (wo): Osaka
• (wann): 2009

Weitere Informationen

• Handle: http://hdl.handle.net/10419/92712
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ