Alderighi-Piga-2007_21.pdf (269.02 kB)
Why should a firm choose to limit the size of its market area?
preprint
posted on 2009-02-23, 14:36 authored by Marco Alderighi, Claudio PigaWe study when a monopolistically-competitive firm may optimally choose to limit the size of its market. This may be the case when the cost of serving the market with geographically dispersed customers is increasing in size. We also investigate the incentives faced by a firm to limit the reach of its market, when it adopts different pricing schemes. We show that under certain assumptions the derived equilibria are constrained socially optimal.
History
School
- Business and Economics
Department
- Economics
Publisher
© Loughborough UniversityVersion
- VoR (Version of Record)
Publication date
2007Notes
This is a working paper. It is also available at: http://ideas.repec.org/p/lbo/lbowps/2007_21.html. This paper was also published as: Alderighi, Marco & Piga, Claudio A., 2008. "Why should a firm choose to limit the size of its market area?," Regional Science and Urban Economics, Elsevier, vol. 38(2), pp. 191-201.ISSN
1750-4171Book series
Loughborough University. Department of Economics. Discussion Paper Series;WP 2007 - 21Language
- en
