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EXTERNAL ECONOMIES OF SCALE AND OPTIMAL PLANT LOCATION: CORRECTION
Author(s) -
HWANG HONG,
MAI CHAOCHENG,
SHIEH YEUNGNAN
Publication year - 2011
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/j.1468-0106.2011.00554.x
Subject(s) - oligopoly , economies of scale , economics , function (biology) , scale (ratio) , returns to scale , key (lock) , microeconomics , economy , econometrics , production (economics) , computer science , geography , cournot competition , computer security , evolutionary biology , biology , cartography
This note shows that there is no interior solution in Mai and Hwang's oligopolistic location model with free entry when the sum of external economies scale and the degree of returns‐to‐scale is one or less than one. Furthermore, the shape of the demand function plays a key role in the determination of the oligopolistic firm's plant location.