Quality, Location and Collusion under Spatial Price Discrimination
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Abstract We present the first demonstration of the influence of a quality rivalry on location choices under spatial price discrimination. The rivalry is shown to generate the socially efficient quality but to push locations inefficiently close together, a result not found under Hotelling pricing. We apply this new equilibrium to the anti-trust policy issue of collusion showing that introducing the quality rivalry reduces the likelihood of collusion.
2018 ◽
Vol 11
(2)
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pp. 223-232
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1998 ◽
Vol 28
(3)
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pp. 297-314
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1985 ◽
Vol 12
(3)
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pp. 283-293
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