RETAIL TRADE CONCENTRATION DUE TO CONSUMERS' IMPERFECT INFORMATION.

The main idea of this study is that geographical concentration of stores selling similar products can be explained by consumers' imperfect information and their resulting need to search the market. A cluster of stores sustained by these forces is not necessarily located at the point that minimizes consumer transportation costs - a fact that distinguishes it from clustering phenomena which may be explained by Hotelling-type arguments. For the purposes of the analysis this work presents a model of monopolistic competition under imperfect information which could be of independent interest.