Can Price Competition Dominate Market Segmentation?

A-Tier
Journal: Journal of Industrial Economics
Year: 1988
Volume: 36
Issue: 4
Pages: 431-42

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

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

Abstract

This note analyzes duopoly competition in a two stage (location-price) game, while allowing each f irm to establish a couple of outlets. Both the circle and the line mo del of spatial competition are considered. The main result is clear-c ut: in equilibrium neither firm will take up the opportunity of openi ng two stores. This is a warning that market segmentation, i.e., comp etition from multiple outlets, might not be attractive at all, becaus e it entails more intense price competition. Copyright 1988 by Blackwell Publishing Ltd.

Technical Details

RePEc Handle
repec:bla:jindec:v:36:y:1988:i:4:p:431-42
Journal Field
Industrial Organization
Author Count
2
Added to Database
2026-01-25