Publication Type

Journal Article

Publication Date

7-2015

Abstract

We derive the closed-form solution characterizing the equilibrium in a circular-city model with competing firms of heterogeneous production costs. Tractability issues in this setting are well known and have not been resolved in prior work. In this paper, the equilibrium solution illustrates effects of production costs on firms’ strategic decisions, their aggregate profit, and consumer surplus.

Keywords

Circular-city model, cost heterogeneity, game theory

Discipline

Computer Sciences | Management Information Systems

Research Areas

Information Systems and Management

Publication

Operations Research Letters

Volume

43

Issue

4

First Page

401

Last Page

404

ISSN

0167-6377

Identifier

10.1016/j.orl.2015.04.010

Publisher

Elsevier

Creative Commons License

Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.

Additional URL

http://dx.doi.org/10.1016/j.orl.2015.04.010

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