Mixed equilibrium in a pure location game: The case of n ≥ 4 firms

Arbeitspapier

The Hotelling game of pure location allows interpretations in spatial competition, political theory, and professional forecasting. In this paper, the doubly symmetric mixed-strategy equilibrium for n ≥ 4 firms is characterized as the solution of a well-behaved boundary value problem. The analysis suggests that, in contrast to the cases n = 3 and n → ∞ , the equilibrium for a finite number of n ≥ 4 firms tends to overrepresent locations at the periphery of its support interval. Moreover, in the class of examples considered, an increase in the number of firms universally leads to a wider range of location choices and to a more dispersed distribution of individual locations. The results are used to comment on the potential benefit of competition in forecasting markets.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 168

Classification and Topics

• Classification: Wirtschaft ; Noncooperative Games ; Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection ; Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior ; Oligopoly and Other Imperfect Markets
• Subject: Location ; Hotelling game ; mixed-strategy equilibrium ; boundary value problem

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ewerhart, Christian
• Event: Veröffentlichung
• (who): University of Zurich, Department of Economics
• (where): Zurich
• (when): 2014

Further information

• DOI: doi:10.5167/uzh-97669
• Handle: http://hdl.handle.net/10419/111224
• Last update: 10.03.2025, 11:42 AM CET