Seminario 20/02: Miguel González Maestre (UMU) Excessive vs. insufficient entry in spatial models: When product design and market size matter
Under spatial product differentiation and product design, we identify conditions for either excessive or insufficient firm entry. We extend previous settings, based on the Salop circular model, to analyze the combined role of positive demand elasticity and endogenous targeted product design. First, we show that, given the number of firms, the equilibrium level of targeted…
