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Spatial Cournot competition and transportation costs in a circular city

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Abstract

We reconsider a Cournot spatial competition in a circular city. We discuss an oligopoly model. We find that two equilibria exist if the transport cost function is nonlinear in distance, while a continuum of equilibria exists if it is linear. Thus, the result of the real indeterminacy of equilibria in the linear transport cost case is knife edge.

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Authors and Affiliations

  1. Institute of Social Science, University of Tokyo, 7-3-1 Hongo, Bunkyo, Tokyo, 113-0033, Japan

    Toshihiro Matsumura

  2. Institute of Social and Economic Research, Osaka University, Mihogaoka 6-1, Ibaraki, Osaka, 567-0047, Japan

    Noriaki Matsushima

Authors
  1. Toshihiro Matsumura
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  2. Noriaki Matsushima
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Correspondence to Noriaki Matsushima.

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Matsumura, T., Matsushima, N. Spatial Cournot competition and transportation costs in a circular city. Ann Reg Sci 48, 33–44 (2012). https://doi.org/10.1007/s00168-010-0399-z

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  • DOI: https://doi.org/10.1007/s00168-010-0399-z

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