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Models a la Lancaster and a la Hotelling: when they are the same

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  • Peitz, Martin

Abstract

Consumer behavior in differentiated product markets can be specified following the Lancastriancharacteristics approach or following Hotelling´s approach of spatial competition. In the case ofunit demand I present a class of models of (heterogeneous) consumer behavior which can bewritten as models à la Lancaster as well as models à la Hotelling.
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  • Peitz, Martin, 1997. "Models a la Lancaster and a la Hotelling: when they are the same," Economics Letters, Elsevier, vol. 54(2), pages 147-154, February.
    • Handle: RePEc:eee:ecolet:v:54:y:1997:i:2:p:147-154
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    1. Gabszewicz, Jean Jaskold & Thisse, Jacques-Francois, 1986. "On the Nature of Competition with Differentiated Products," Economic Journal, Royal Economic Society, vol. 96(381), pages 160-172, March.
    2. Friedman, James, 1993. "Oligopoly theory," Handbook of Mathematical Economics, in: K. J. Arrow & M.D. Intriligator (ed.), Handbook of Mathematical Economics, edition 4, volume 2, chapter 11, pages 491-534, Elsevier.
    3. labbe, M. & Peeters, D. & Thisse, J.F., 1992. "Location on Networks," Papers 9216, Universite Libre de Bruxelles - C.E.M.E..
    4. Caplin, Andrew & Nalebuff, Barry, 1991. "Aggregation and Imperfect Competition: On the Existence of Equilibrium," Econometrica, Econometric Society, vol. 59(1), pages 25-59, January.
    5. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
    6. ANDERSON, Simon P. & de PALMA, André & THISSE, Jacques-François, 1992. "Interpretations of the logit discrete choice models and the theory of product differentiation," LIDAM Reprints CORE 1017, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    7. John R. Hauser, 1988. "Note—Competitive Price and Positioning Strategies," Marketing Science, INFORMS, vol. 7(1), pages 76-91.
    8. G. C. Archibald & B. Curtis Eaton, 1989. "Two Applications of Characteristics Theory," Palgrave Macmillan Books, in: George R. Feiwel (ed.), The Economics of Imperfect Competition and Employment, chapter 12, pages 409-436, Palgrave Macmillan.
    9. repec:crs:wpaper:8801 is not listed on IDEAS
    10. W. M. Gorman, 1980. "A Possible Procedure for Analysing Quality Differentials in the Egg Market," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(5), pages 843-856.
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    Cited by:

    1. Didier Laussel, 2018. "Strategic Product Design under Duopoly," Annals of Economics and Statistics, GENES, issue 131, pages 25-44.

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    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory

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