Oligopolistic competition in heterogeneous goods market: optimal location and quality position of firms

• Main Authors: Wen-cheng Lin, 林文丞
• Other Authors: Ya-po Yang
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/qkcx4s

碩士 === 國立中山大學 === 經濟學研究所 === 104 === This paper contains two topics. One is the optimal location, the other is quality position of firms. One of the topics extends Barbell model which has the same size’s markets at the end of a straight line’s both side. There are n_A and n_B retailers respectively located on the both side, having to buy the product form the wholesaler then sell to the customers. Additionally, retailers would absorb the transport cost and fixed cost. We discuss how the numbers of retailers affect the wholesaler’s location and after the free entry happened. Given n_A = n_B = n condition, under the uniform pricing, we derive the optimal location would move from any place to 1/2 when the numbers of retailers increase gradually. Under the discriminatory pricing, the optimal location would move from the end of both side to any place when the numbers of retailers increase gradually. Furthermore, the social welfare and total output may higher under the discrimination depend on the numbers of retailers. Then we allow the outside retailers to entry the markets, simply get the familiar results with above. The other topic is we assume that there is a monopolist producing the higher (lower) quality product in the market at first. However, if the new product which is lower (higher) quality appears, should the monopolistc firm simultaneously produce two different quality products or only let the entrant produce the new one? We compare the individual incentives and find no matter what the new product’s quality is, the entrant always has the higher incentive to produce it.