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Spatial price discrimination, sequential location and convex production costs

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  • Gabriel Courey

    (Wittenberg University)

Abstract

Simultaneous location is known to be socially superior to sequential location under spatial price discrimination given constant marginal production costs. For the first time I demonstrate that sequential location can be socially superior to simultaneous location given convex production costs. The asymmetric sequential locations lower the sum of production and transport cost below the symmetric but inefficiently distant simultaneous locations.

Suggested Citation

  • Gabriel Courey, 2018. "Spatial price discrimination, sequential location and convex production costs," Letters in Spatial and Resource Sciences, Springer, vol. 11(2), pages 223-232, July.
    • Handle: RePEc:spr:lsprsc:v:11:y:2018:i:2:d:10.1007_s12076-018-0213-6
    DOI: 10.1007/s12076-018-0213-6
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    Spatial price discrimination; Sequential location; Social welfare; Convex production costs;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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