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On large market asymptotics for spatial price competition models

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  • Otsu, Taisuke
  • Sunada, Keita

Abstract

In spatial price competition models, demand factors have correlation with prices through the markup so that their identification power decreases as the number of product grows. Asymptotic results indicate lack of consistency of the estimator due to weak instruments.

Suggested Citation

  • Otsu, Taisuke & Sunada, Keita, 2024. "On large market asymptotics for spatial price competition models," LSE Research Online Documents on Economics 120588, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:120588
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    References listed on IDEAS

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    More about this item

    Keywords

    spatial price competition; weak instruments;

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General

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