Infrastructure, as it impacts transport costs, is crucial in determining equilibrium outcomes in spatial competition; however, infrastructure investment is typically exogenous. Our political economy analysis of infrastructure choice is based upon consumer preferences derived from Salop’s...

In Hotelling style duopoly location games the product variety (or firm locations) is typically not socially optimal. This occurs because the competitive outcome is driven by the density of consumers at the margin while the socially optimal outcome depends on the whole distribution of consumer...

In spatial competition, public infrastructure plays a crucial role in determining product market outcomes. In our model, consideration of infrastructure’s impact on the product market drives the voting behavior of consumers in their dual role as voter/taxpayers. The spatial heterogeneity of...