The authors consider a price-taking equilibrium in the spatial setting. A (unique) pricing equilibrium is shown to exist for any set of firm locations. This equilibrium is then used to examine locational incentives in the two-stage process in which firms first choose locations anticipating the...

This paper considers a generalization of the Hotelling model of spatial competition. It is shown that a pure strategy perfect equilibrium in the two-stage location-price game exists only under very stringent conditions. These conditions are in fact the conditions for profit to be concave in...