Citation

Discussion Paper Details

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Title: The Importance of the Distribution of Consumers in Horizontal Product Differentiation

Author(s): Antoni Calvó-Armengol and Yves Zenou

Publication Date: October 2001

Keyword(s): hotelling, market equilibrium and social optimism

Programme Area(s): Industrial Organization

Abstract: This Paper examines the importance of the distribution of consumers in Hotelling's circle on the comparison between the optimal and the market equilibrium levels of diversity. It finds that when most consumers are located very close to the firms, the result of Salop that the equilibrium number of firms is larger than the optimal one (surplus maximizing) can be reversed.

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Bibliographic Reference

Calvó-Armengol, A and Zenou, Y. 2001. 'The Importance of the Distribution of Consumers in Horizontal Product Differentiation'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=3031