The Price Effects of Spatial Competition.

The article focuses on the price effects of spatial competition. A recent paper by D.R. Capozza and R.Van Order (CVO) (1977) proposed a generalization of the M.L. Greenhut-M.H. Hwang-H. Ohta (OHO) (1975) analysis of pricing under three alternative types of spatial competition. The GHO analysis was b...

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Publicado en:Review of Economic Studies Vol. 48; no. 2; pp. 317 - 326
Autor principal: Ohta, H.
Formato: Artículo
Publicado: Oxford University Press / USA Apr81
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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      pub: Oxford University Press / USA
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        atl: The Price Effects of Spatial Competition.
      aug:
        au: Ohta, H.
        affil:
          Aoyama Gakuin University.
          University of Houston.
      su:
        Competition
        Efficient market theory
        Monopoly capitalism
        Pricing
        Market equilibrium
        Monopolistic competition
        Competitive advantage in business
        Elasticity (Economics)
        Price maintenance
        Profit
        Modifications
      sug:
        subj:
          Competition
          Efficient market theory
          Monopoly capitalism
          Pricing
          Market equilibrium
          Monopolistic competition
          Competitive advantage in business
          Elasticity (Economics)
          Price maintenance
          Profit
          Modifications
      ab: The article focuses on the price effects of spatial competition. A recent paper by D.R. Capozza and R.Van Order (CVO) (1977) proposed a generalization of the M.L. Greenhut-M.H. Hwang-H. Ohta (OHO) (1975) analysis of pricing under three alternative types of spatial competition. The GHO analysis was based on a short-run model in which the locations of firms are assumed to be fixed. CVO accordingly proposed relaxation of this rigid assumption to examine if the GHO results also apply to the long-run zero-profit industry equilibrium. They confirmed the GHO results, which, however, they also contended, require certain particular modifications as well in the light of their own models. The CVO contribution lies in their simple model analysis of long-run industry equilibrium conditions--a generalization of the GHO analysis. The article also briefly reviews the theory of spatial monopoly. Initially some fundamental assumptions are set forth. This is followed by derivation of the market demand function for the spatial monopolist. The market demand in turn is shown to be more or less elastic than the assumed basic demand function depending on the curvature of the latter curve. The article also comments on the so-called "paradox of spatial monopoly."
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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