Location as an instrument for social welfare improvement in a spatial model of Cournot competition
ISSN: 0210-1521
Datum der Publikation: 2006
Ausgabe: 30
Nummer: 1
Seiten: 117-136
Art: Artikel
Andere Publikationen in: Investigaciones económicas
Zusammenfassung
Two-stage models are the main frameworks in the analysis of oligopolistic competition. Literature has discussed some properties of such models when Cournot competition occurs in the second stage and assuming a non-spatial context. It .nds that private and social optima are asymmetric. Using spatial behavior with multiple marketplaces, the outcome is di erent. A social planner can use the location variable as an instrument for reallocating production from the equilibrium spatial pattern to the optimal outcome while maintaining the symmetry of the model.