Given a network, the facility location problem consists of locating a set of sites on the network to serve existing clients so as to minimize its total cost. Special cases include the simple plant location problem (SPLP), bank account location, p-facility location, and p-median problem.

A two-stage game is used in this paper to model a long-run market with spatially separated producers and with multi-period demands: first, firmas simultaneously and independently invest their capacities; second, after capacities are set up in the first stage and made public, firms engage in a...