EconStor >
Max-Planck-Institut für Ökonomik, Jena >
Jena Economic Research Papers, MPI für Ökonomik >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/25677
  
Title:Agglomeration and endogenous absorptive capacities: hotelling revisited PDF Logo
Authors:Hussler, Caroline
Lorentz, André
Rondé, Patrick
Issue Date:2007
Series/Report no.:Jena economic research papers 2007,102
Abstract:This paper proposes a theoretical model of spatial duopoly, where the location, on the one hand, and the absorptive capacity of rms as function of their internal R&D investment, on the other hand, endogenously determine the maximum level of knowledge spillovers rms might absorb. Our goal is to test whether this new modelling of spillovers a ects the traditional outcomes in terms of rms location choices . We solve a three-stage game, where rms choose their geo- graphical location, prior to their level of internal R&D expenditures, and nally compete in prices. We found that, at the optimum, rms choose the same level of internal R&D and set the same price, inde- pendently of their location. Moreover, rms locate symmetrically and tends to agglomerate in the center of the market as the transportation costs increase, knowledge spillovers being in that case maximum.
Subjects:spatial agglomeration
endogenous spillovers
absorptive capacity
non-cooperative game
JEL:O33
R12
L13
Document Type:Working Paper
Appears in Collections:Jena Economic Research Papers, MPI für Ökonomik

Files in This Item:
File Description SizeFormat
559549008.PDF387.69 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/25677

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.