Product Differentiation and Entry Timing in a Continuous Time Spatial Competition Model

Ebina, Takeshi; Matsushima, Noriaki; Shimizu, Daisuke

Institute of Social and Economic Research Discussion Papers, 2014, 915, 1-25

Number of Access:361（2025-07-24 04:24 Counts）

Identifier to cite or link to this item: https://hdl.handle.net/11094/50969

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Title
Product Differentiation and Entry Timing in a Continuous Time Spatial Competition Model
Creator
NRID
1000000579766 1000000579766
CreatorName
Ebina, Takeshi
NRID
1000080334879 1000080334879
ORCID
0000-0002-7865-3875 0000-0002-7865-3875
researchmap permalink
read0116301 read0116301
Scopus Author ID
7005645778 7005645778
CreatorName
Matsushima, Noriaki
CreatorName
Shimizu, Daisuke
Subject
Location
Hotelling model
Continuous time
Entry timing
Abstract
We extend the well-known spatial competition model (d'Aspremont et al., 1979) to a continuous time model in which two firms compete in each instance. Our focus is on the entry timing decisions of firms and their optimal locations. We demonstrate that the leader has an incentive to locate closer to the centre to delay the follower's entry, leading to a non-maximum differentiation outcome. We also investigate how exogenous parameters affect the leader's location and firms' values and, in particular, numerically show that the profit of the leader changes non-monotonically with an increase in the transport cost parameter.
Publisher
The Institute of Social and Economic Research, Osaka University
Source Title
Institute of Social and Economic Research Discussion Papers
Volume (Issue)
915
Page
1-25
Date of Issued
2014-10
Language
English
Handle URL
https://hdl.handle.net/11094/50969
Relation.references
URI
https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2014/DP0915.pdf
Access Rights
metadata only access
Category
ディスカッション／ワーキング・ペーパー DP/WP
Institute of Social and Economic Research Discussion Papers