Hotelling's Location Model with Quality Choice in Mixed Duopoly

We investigate a mixed duopoly market by introducing quality choice into the Hotelling-type spatial competition model with linear transportation costs. We show that there does not exist a subgame perfect Nash equilibrium (SPNE) of location choice in the three-stage game that is location-then-quality choice and subsequent price choice. Moreover, we show the conditions of the existence of the quality equilibrium.

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Year of publication:	2007
Authors:	Sanjo, Yasuo
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 18.2007, 2, p. 1-11
Publisher:	AccessEcon

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Classification:	R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location ; L1 - Market Structure, Firm Strategy, and Market Performance
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005110921