TITLE

Competition on Networks: Some Introductory Notes

AUTHOR(S)
De Palma, André; Thisse, Jacques-Franqois
PUB. DATE
February 1993
SOURCE
Transportation Science;Feb93, Vol. 27 Issue 1, p1
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
Problems involving competition on networks play an increasingly important role in modern economies. One of the most difficult problems in competition on networks is probably that of determining pricing and network design in a competitive environment. This is especially relevant in the context of the airline industry, where companies have to choose their routes together with their price schedules between different origins and destinations. This problem has not received much academic attention, in particular when the network design of competing firms is explicitly accounted for. Another important dimension of competition on networks involves the location of competitive facilities. In many real world situations, location is not the only variable controlled by the decision makers: price is also another important strategic instrument. Many networks are perceived as more or less attractive as the number of customers who are linked to them increases. In the former case, economists speak of a positive externality and in the latter of a negative externality.
ACCESSION #
4454689

 

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