Collusion, agglomeration, and heterogeneity of firms
Jehiel (1992) and Friedman and Thisse (1993) show that spatial agglomeration appears in a standard two-stage location price model if symmetric firms collude in prices. We introduce a cost difference between two firms. We show that agglomeration never appears in a collusive equilibrium even when the cost difference between firms is sufficiently small.
Year of publication: |
2011
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Authors: | Matsumura, Toshihiro ; Matsushima, Noriaki |
Published in: |
Games and Economic Behavior. - Elsevier, ISSN 0899-8256. - Vol. 72.2011, 1, p. 306-313
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Publisher: |
Elsevier |
Subject: | Cost asymmetry Spatial agglomeration Collusion |
Saved in:
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