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On Hotelling's Location Model With a Restricted Reservation Price
Author(s) -
Henry Wang X.,
Yang Bill Z.
Publication year - 1999
Publication title -
australian economic papers
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.351
H-Index - 15
eISSN - 1467-8454
pISSN - 0004-900X
DOI - 10.1111/1467-8454.00056
Subject(s) - reservation , reservation price , competition (biology) , microeconomics , economics , price discrimination , industrial organization , business , econometrics , computer science , computer network , ecology , biology
This paper studies Hotelling's location model with a restricted consumer reservation price. It establishes that firms will locate closer to the middle of the market when price competition becomes more intense caused by a low reservation price.