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Credible collusion in a model of spacial competition

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  • Raquel Arévalo Tomé
  • José María Chamorro Rivas

Abstract

In a spatial model with quantity setting firms, we analyze the possibility of cooperation in a long term relationship, where firms compete in location. It is found that endogeneizing the location decisions makes collusion more difficult.

Suggested Citation

  • Raquel Arévalo Tomé & José María Chamorro Rivas, 2004. "Credible collusion in a model of spacial competition," Working Papers 0404, Universidade de Vigo, Departamento de Economía Aplicada.
    • Handle: RePEc:vig:wpaper:0404
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    References listed on IDEAS

    as
    1. John Gross & William L. Holahan, 2003. "Credible Collusion in Spatially Separated Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(1), pages 299-312, February.
    2. Fudenberg, Drew & Tirole, Jean, 1989. "Noncooperative game theory for industrial organization: An introduction and overview," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 1, chapter 5, pages 259-327, Elsevier.
    3. Anderson, Simon P & Neven, Damien J, 1991. "Cournot Competition Yields Spatial Agglomeration," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 32(4), pages 793-808, November.
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    Cited by:

    1. Stefano Colombo, 2013. "Product Differentiation and Collusion Sustainability When Collusion Is Costly," Marketing Science, INFORMS, vol. 32(4), pages 669-674, July.

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    More about this item

    Keywords

    Supergames; spatial competition;

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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