Natural oligopolies with exogenous sunk costs: A non-Suttonian result

B-Tier
Journal: Journal of Mathematical Economics
Year: 2010
Volume: 46
Issue: 5
Pages: 844-854

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

In a spatial competition model with exogenous fixed costs and divisible goods, we obtain non-Suttonian results. When the economy is infinitely replicated, the number of firms does go to infinity but, as consumers' income goes to infinity, the equilibrium number of firms tends toward a finite value. This occurs because the global demand to each firm becomes in the limit infinitely sensitive to price differentials since they give then rise to infinitely large differences in purchase expenditure.

Technical Details

RePEc Handle
repec:eee:mateco:v:46:y:2010:i:5:p:844-854
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25