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Production Location under Technology Uncertainty

Author

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  • Lin-Ti Tan

    (Institute of Economics, Academia Sinica, Nankang, Taipei 115, Taiwan)

  • Song-Ken Hsu

    (Department of Industrial Economics, Tamkang University, Tamsui, Taipei 251, Taiwan)

Abstract

In this paper we examine the implications of technology uncertainty for production location in a general setting, in which the location and production decisions are determined ex ante and a general specification of technology uncertainty is adopted. In addition, to examine the endpoint optimality issue, we also provide comparative static results which are novel in the literature. Moreover, the exhaustion of information contained in the second-order optimal conditions in deriving the conditions for endpoint optimality differentiates our analysis from previous works.

Suggested Citation

  • Lin-Ti Tan & Song-Ken Hsu, 2000. "Production Location under Technology Uncertainty," Environment and Planning A, , vol. 32(3), pages 445-454, March.
    • Handle: RePEc:sae:envira:v:32:y:2000:i:3:p:445-454
    DOI: 10.1068/a31195
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    References listed on IDEAS

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    1. Yeung-nan Shieh, 1987. "Increasing Returns to Scale and Location Theory of the Firm Under Price Uncertainty," Urban Studies, Urban Studies Journal Limited, vol. 24(2), pages 163-166, April.
    2. Just, Richard E. & Pope, Rulon D., 1978. "Stochastic specification of production functions and economic implications," Journal of Econometrics, Elsevier, vol. 7(1), pages 67-86, February.
    3. Mathur, V. K., 1985. "Location theory of the firm under price uncertainty : Some New Conclusions," Regional Science and Urban Economics, Elsevier, vol. 15(4), pages 597-598, November.
    4. Park, Keehwan & Mathur, Vijay K., 1990. "Uncertainty in location : Location theory under uncertainty without and with taxes: A generalization," Journal of Urban Economics, Elsevier, vol. 27(3), pages 362-380, May.
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    Cited by:

    1. Lin-Ti Tan & Yan-Shu Lin, 2005. "Spatial Monopoly Pricing in a Stochastic Environment," IEAS Working Paper : academic research 05-A004, Institute of Economics, Academia Sinica, Taipei, Taiwan.

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