Title: On the limits and possibilities of the principle of minimum differentiation
Authors: Hinloopen, Jeroen ×
van Marrewijk, C #
Issue Date: Jul-1999
Publisher: Elsevier science bv
Series Title: International journal of industrial organization vol:17 issue:5 pages:735-750
Abstract: Introducing a finite reservation price in Hotelling's spatial duopoly with linear transportation costs shows that (i) there does not exist a pure strategy symmetric location equilibrium if the reservation price is 'high', (ii) there is a continuum of (monopolistic) equilibria if the reservation price is 'low', and (iii) there exists a unique pure strategy symmetric location equilibrium (in which the two firms compete with each other and cover the entire market) if the reservation price is 'intermediate'. The equilibrium distance between the two firms in the latter case is at least a quarter and at most half the length of the market. (C) 1999 Elsevier Science B.V. All rights reserved.
ISSN: 0167-7187
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Department of Managerial Economics, Strategy and Innovation (MSI), Leuven
× corresponding author
# (joint) last author

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