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Competitive location and pricing on a line with metric transportation costs

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  • Arbib, Claudio
  • Pınar, Mustafa Ç.
  • Tonelli, Matteo

Abstract

Consider a three-level non-capacitated location/pricing problem: a firm first decides which facilities to open, out of a finite set of candidate sites, and sets service prices with the aim of revenue maximization; then a second firm makes the same decisions after checking competing offers; finally, customers make individual decisions trying to minimize costs that include both purchase and transportation. A restricted two-level problem can be defined to model an optimal reaction of the second firm to known decision of the first.

Suggested Citation

  • Arbib, Claudio & Pınar, Mustafa Ç. & Tonelli, Matteo, 2020. "Competitive location and pricing on a line with metric transportation costs," European Journal of Operational Research, Elsevier, vol. 282(1), pages 188-200.
    • Handle: RePEc:eee:ejores:v:282:y:2020:i:1:p:188-200
    DOI: 10.1016/j.ejor.2019.08.042
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    References listed on IDEAS

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    1. Paul Berglund & Changhyun Kwon, 2014. "Solving a Location Problem of a Stackelberg Firm Competing with Cournot-Nash Firms," Networks and Spatial Economics, Springer, vol. 14(1), pages 117-132, March.
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    7. Kress, Dominik & Pesch, Erwin, 2012. "Sequential competitive location on networks," European Journal of Operational Research, Elsevier, vol. 217(3), pages 483-499.
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    Cited by:

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    2. Lin, Yun Hui & Tian, Qingyun, 2023. "Facility location and pricing problem: Discretized mill price and exact algorithms," European Journal of Operational Research, Elsevier, vol. 308(2), pages 568-580.
    3. Danzhu Wang & Lingyun Zhou & Huimin Zhang & Xiaokang Liang, 2021. "A Bi-Level Model for Green Freight Transportation Pricing Strategy Considering Enterprise Profit and Carbon Emissions," Sustainability, MDPI, vol. 13(12), pages 1-20, June.
    4. Schlicher, Loe & Lurkin, Virginie, 2022. "Stable allocations for choice-based collaborative price setting," European Journal of Operational Research, Elsevier, vol. 302(3), pages 1242-1254.
    5. Keqiang Wang & Guoxiang Li & Hongmei Liu, 2020. "Location choice of industrial land reduction in Metropolitan Area: Evidence from Shanghai in China," Growth and Change, Wiley Blackwell, vol. 51(4), pages 1837-1859, December.

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