This paper explores the implications of price-dependent demand in spatial models of product differentiation. We introduce consumers with a quasi-linear utility function in the framework of the Salop (1979) model. We show that the so-called excess entry theorem relies critically on the assumption...

Production functions provide a mapping from the firms' input quantity and productivity to output quantity. This mapping only generates unbiased estimates if input and output quality variation within and between observation units is accounted for. I review and classify state-of-the-art methods to...

In this article we propose an innovative way of delineating geographical markets based on easily accessible data. We apply this concept for the day care industry and investigate providers' location choices relative to local market characteristics to evaluate the widespread presumption that local...

The theoretical literature of industrial organization shows that the distances between consumers and firms have first-order implications for competitive outcomes whenever transportation costs are large. To assess these effects empirically, we develop a structural model of competition among...