We study product differentiation on a Salop circle when firms relocate incrementally due to bounded rationality. We prove that, under common assumptions on demand, firms relocate only when two or more firms target the same niche. In any other case, there is no incentive for any firm to relocate...

In managing their value network, firms have to balance current and future value concerns and own and network partners' concerns. Firms generate immediate value through manufacturing and selling the current generation of products together with other firms in their production network. Firms...