A platform for research: civil engineering, architecture and urbanism
A platform for research: civil engineering, architecture and urbanism
On the shape and size of market areas
Abstract How should the suppliers of a commodity be located so as to generate the greatest amount of welfare per unit area? Welfare is defined as consumers' surplus plus producers' profits. Costs of production are assumed to be linear functions of output identical for all firms and at all locations. Consumers are distributed in an unbounded two dimensional space at uniform density. They have identical linear demand functions. We determine both the optimal shape and the optimal radius of a representative firm's market area and compare them to those under free entry; the Löschian case of monopolistic competition. The general shape is that of rounded hexagons (or hexagonally flattened circles) with hexagons and circles as limiting cases. When fixed costs are high and firms are few, free entry creates fewer firms than is optimal, contrary to the well-known results for a free entry equilibrium in non-spatial monopolistic competition.
On the shape and size of market areas
Abstract How should the suppliers of a commodity be located so as to generate the greatest amount of welfare per unit area? Welfare is defined as consumers' surplus plus producers' profits. Costs of production are assumed to be linear functions of output identical for all firms and at all locations. Consumers are distributed in an unbounded two dimensional space at uniform density. They have identical linear demand functions. We determine both the optimal shape and the optimal radius of a representative firm's market area and compare them to those under free entry; the Löschian case of monopolistic competition. The general shape is that of rounded hexagons (or hexagonally flattened circles) with hexagons and circles as limiting cases. When fixed costs are high and firms are few, free entry creates fewer firms than is optimal, contrary to the well-known results for a free entry equilibrium in non-spatial monopolistic competition.
On the shape and size of market areas
Beckmann, Martin J. (author)
1989
Article (Journal)
English
The Law Of Market Areas And The Size Distribution Of Urban Centers
| Online Contents | 1997
| Online Contents | 1993
The housing market in integrating areas
| Online Contents | 1970
An integrated production-stage analysis on market areas and supply areas
| Online Contents | 2009