[PDF] Market Concentration And Product Variety Under Spatial Competition eBook

Author : John Beath
Publisher : Cambridge University Press
Page : 220 pages
File Size : 19,50 MB
Release : 1991-02-22
Category : Business & Economics
ISBN : 9780521335522

GET BOOK

There are few industries in modern market economies that do not manufacture differentiated products. This book provides a systematic explanation and analysis of the widespread prevalence of this important category of products. The authors concentrate on models in which product selection is endogenous. In the first four chapters they consider models that try to predict the level of product differentiation that would emerge in situations of market equilibrium. These market equilibria with differentiated products are characterised and then compared with social welfare optima. Particular attention is paid to the distinction between horizontal and vertical differentiation as well as to the related issues of product quality and durability. This book brings together the most important theoretical contributions to these topics in a succinct and coherent manner. One of its major strengths is the way in which it carefully sets out the basic intuition behind the formal results. It will be useful to advanced undergraduate and graduate students taking courses in industrial economics and microeconomic theory.

Author : Shin Kun Peng
Publisher :
Page : 0 pages
File Size : 47,25 MB
Release : 2007
Category :
ISBN :

GET BOOK

We propose location-then-variety competition for a multiproduct and multi-store oligopoly, in which the number of firms, the number of stores and their location, and the number of varieties are endogenously determined. We show that as compared to price-then-variety and quantity-then-variety competition, location-then-variety competition with multistores yields a much richer set of equilibrium outcomes, such as market segmentation, interlacing, sandwich, and enclosure.

Author : Frode Steen
Publisher : Now Publishers Inc
Page : 89 pages
File Size : 28,80 MB
Release : 2010
Category : Business & Economics
ISBN : 1601983344

GET BOOK

Semicollusion provides a framework for understanding the mechanism at work with semicollusion and reviews the different approaches in the literature to this topic.

Author : Sónia Félix
Publisher : International Monetary Fund
Page : 57 pages
File Size : 11,51 MB
Release : 2019-12-13
Category : Business & Economics
ISBN : 1513521519

GET BOOK

This paper studies the macroeconomic effect and underlying firm-level transmission channels of a reduction in business entry costs. We provide novel evidence on the response of firms' entry, exit, and employment decisions. To do so, we use as a natural experiment a reform in Portugal that reduced entry time and costs. Using the staggered implementation of the policy across the Portuguese municipalities, we find that the reform increased local entry and employment by, respectively, 25% and 4.8% per year in its first four years of implementation. Moreover, around 60% of the increase in employment came from incumbent firms expanding their size, with most of the rise occurring among the most productive firms. Standard models of firm dynamics, which assume a constant elasticity of substitution, are inconsistent with the expansionary and heterogeneous response across incumbent firms. We show that in a model with heterogeneous firms and variable markups the most productive firms face a lower demand elasticity and expand their employment in response to increased entry.

Author : Tarek H. Selim
Publisher :
Page : 0 pages
File Size : 17,37 MB
Release : 2020
Category :
ISBN :

GET BOOK

Spatial quality choice is introduced, where consumers are horizontally differentiated by taste and firms vertically differentiated by quality location, within an equilibrium model of duopoly competition characterized by asymmetric fixed and variable costs. Firms choose quality location followed by prices but then may vertically re-locate their quality offerings based on changing horizontal consumer taste. A monopolistic equilibrium solution arises with firms achieving positive economic profits through price-quality markups exceeding marginal costs. Under strict inequality conditions, each firm acts as a monopolistic competitor within a range of quality choices governed by multiple relative differentiation outcomes. On the other hand, vertical re-location exhibits a resistance to change on the part of vertically located firms such that firms dislike quality re-location and prefer stable preferences in quality. Such resistance to change is overcome by firms re-locating their quality offerings to maximize monopolistic brand-space gains. It is argued that more horizontal differentiation may force more product differentiation by vertical quality relocation. A relative change in quality preferences may result in wider quality spreads in the market through vertical quality re-locations, even though the resistance to change arguments may still hold good.

Author : Haimanti Bhattacharya
Publisher :
Page : 0 pages
File Size : 46,87 MB
Release : 2020
Category :
ISBN :

GET BOOK

Competing theories in industrial organization predict that more concentrated industries will lead to a smaller and more efficient variety of products or, alternately, a larger and less efficient array of products. This paper presents an empirical study of these competing implications that estimates the impact of market concentration on new product introductions in a panel of nine food processing industries over 1983 to 2004. Controlling for industry-level unobservables (using fixed effects) and endogeneity of industry market structure, we find that industry concentration promotes the introduction of new products. Preliminary evidence also suggests that new product introductions spur subsequent food industry mergers. Both conclusions are consistent with the “entry-for-merger” theory of product variety wherein atomistic innovators introduce new products in anticipation of profitable future mergers with concentrated firms.

Author : Steven Brakman
Publisher : Cambridge University Press
Page : 0 pages
File Size : 14,27 MB
Release : 2011-07-21
Category : Business & Economics
ISBN : 9781107402430

GET BOOK

Avinash Dixit and Joseph Stiglitz revolutionized the modelling of imperfectly competitive markets and launched "the second monopolistic competition revolution". Experts in the areas of macroeconomics, international trade theory, economic geography, and international growth theory examine the success of the second revolution in this collection of papers. They reveal what appears to be "missing" and look forward to the next step in the modelling of imperfectly competitive markets. The text includes a comprehensive survey of the two monopolistic competition revolutions, and previously unpublished working papers by Dixit and Stiglitz that led to their famous 1977 paper.