The role of consumer networks in firms’ multi-characteristics competition and market share inequality
- Journal Article
Rights / licenseCreative Commons Attribution 4.0 International
We develop a location analysis spatial model of firms' competition in multi-characteristics space, where consumers' opinions about the firms' products are distributed on multilayered networks. Firms do not compete on price but only on location upon the products' multi-characteristics space, and they aim to attract the maximum number of consumers. Boundedly rational consumers have distinct ideal points/tastes over the possible available firm locations but, crucially, they are affected by the opinions of their neighbors. Proposing a dynamic agent-based analysis on firms' location choice we characterize multi-dimensional product differentiation competition as adaptive learning by firms' managers and we argue that such a complex systems approach advances the analysis in alternative ways, beyond game-theoretic calculations Show more
Journal / seriesStructural Change and Economic Dynamics
Pages / Article No.
Organisational unit03682 - Schweitzer, Frank / Schweitzer, Frank
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