Reaction Function Based Dynamic Location Modeling in Stackelberg–Nash–Cournot Competition
We formulate a dynamic facility location model for a firm locating on a discrete network. It is assumed that this locating firm will act as the leader firm in an industry characterized by Stackelberg leader–follower competition. The firm’s I competitors are assumed to act as Cournot firms and are ea...
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Veröffentlicht in: | Networks and spatial economics 2007-03, Vol.7 (1), p.77-97 |
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creator | Friesz, Terry Kwon, Changhyun Miller, Tan Tobin, Roger |
description | We formulate a dynamic facility location model for a firm locating on a discrete network. It is assumed that this locating firm will act as the leader firm in an industry characterized by Stackelberg leader–follower competition. The firm’s I competitors are assumed to act as Cournot firms and are each assumed to operate under the assumption of zero conjectural variation with respect to their I–1 Cournot competitors. Using sensitivity analysis of variational inequalities within a hierachical mathematical programming approach, we develop reaction function based dynamic models to optimize the Stackelberg firm’s location decision. In the second half of this paper, we use these models to illustrate through a numerical example the insights yielded by our approach. Copyright Springer Science+Business Media, LLC 2007 |
doi_str_mv | 10.1007/s11067-006-9013-4 |
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source | RePEc; Business Source Complete; SpringerLink Journals - AutoHoldings |
subjects | Competition Decision making Dynamic Stackelberg equilibrium location modeling Economic models Equilibrium Location of industry Mathematical programming Reaction functions Sensitivity analysis Studies |
title | Reaction Function Based Dynamic Location Modeling in Stackelberg–Nash–Cournot Competition |
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