Three Essays in Industrial Organization

Three Essays in Industrial Organization
Author: Meng-Yu Liang
Publisher:
Total Pages: 220
Release: 1999
Genre:
ISBN:

The third chapter provides a necessary condition for the existence of a symmetric pure strategy Nash equilibrium in a circular model when consumers have heterogeneous unit transportation costs. Given a fixed mean of unit transportation costs in the population, the candidate symmetric equilibrium price is always smaller when there is heterogeneity in the unit transportation costs than when there is not. Hence, given the assumption of free entry, the market may generate less brands with heterogeneity.