Abstract

http://ssrn.com/abstract=961889
 
 

References (15)



 
 

Citations (3)



 


 



Location, Location, Location! A Classroom Demonstration of the Hotelling Model


Lisa R. Anderson


College of William and Mary - Department of Economics

Beth A. Freeborn


Bureau of Economics

Jessica Holmes


Middlebury College

Mark Jeffreys


Utah Valley University

Daniel Lass


University of Massachusetts at Amherst - College of Natural Resources & the Environment - Department of Resource Economics

John C Soper


John Carroll University - Boler School of Business

December 2006


Abstract:     
This paper outlines a classroom experiment that complements the standard theoretical discussion of Hotelling's (1929) spatial competition model. The exercises will provide students with a deeper understanding of the intuition behind competitive clustering, resolving the Bertrand paradox, and product positioning. Students act as street vendors operating within a "linear city." Each student chooses the most profitable location, taking into account the locations of competitors and the transportation costs of customers. Other treatments include choosing price given location and a two-stage model of location and price. The experiment can be implemented in any size class, with very little preparation. It is well-suited for courses in microeconomics, industrial organization, game theory, experimental economics, and public choice economics, and can also be incorporated into political science courses.

Number of Pages in PDF File: 27

JEL Classification: A22, C22, C90, D21, L1

working papers series


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Date posted: February 8, 2007  

Suggested Citation

Anderson, Lisa R. and Freeborn, Beth A. and Holmes, Jessica and Jeffreys, Mark and Lass, Daniel and Soper, John C, Location, Location, Location! A Classroom Demonstration of the Hotelling Model (December 2006). Available at SSRN: http://ssrn.com/abstract=961889 or http://dx.doi.org/10.2139/ssrn.961889

Contact Information

Lisa R. Anderson (Contact Author)
College of William and Mary - Department of Economics ( email )
Williamsburg, VA 23187-8795
United States
Beth A. Freeborn
Bureau of Economics ( email )
601 New Jersey Ave., NW
Washington, DC 20580
United States
Jessica Holmes
Middlebury College ( email )
Middlebury, VT 05753
Mark Jeffreys
Utah Valley University ( email )
800 West University Parkway
Orem, UT 84058-5999
United States
Daniel Lass
University of Massachusetts at Amherst - College of Natural Resources & the Environment - Department of Resource Economics ( email )
Stockbridge Hall
80 Campus Center Way
Amherst, MA 01003-9246
United States
413-545-1501 (Phone)
413-545-5853 (Fax)
Jack Soper
John Carroll University - Boler School of Business ( email )
University Heights, OH 44118-4581
United States
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References:  15
Citations:  3

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