Spatial competition with interacting agents

Bertrand Ottino-Loffler, Forrest Stonedahl, Vipin Veetil, Uri Wilensky

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

Using agent-based modeling, we generalize Hotelling's model of spatial competition with more than two firms in a two-dimensional space. Firms choose both price and location to maximize profits. The principle of minimum diffferentiation does not hold in general. Local duopolies emerge from the interaction between firms. Firms do not spread uniformly across the two-dimensional space, nor do they all charge the same price. Firms in more competitive locations charge lower prices and generate less profit.

Original languageEnglish (US)
Pages (from-to)75-91
Number of pages17
JournalInternational Journal of Microsimulation
Volume10
Issue number3
StatePublished - Dec 1 2017

Keywords

  • Agent-based modeling
  • Hotelling
  • Price competition

ASJC Scopus subject areas

  • Modeling and Simulation

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