A. Downs, “An Economic Theory of Political Action in a Democracy,” Journal of Political Economy, Vol. 65, No. 2, 1957, pp. 135-150. doi:10.1086/257897
has been cited by the following article:
TITLE: Instability in the Hotelling’s Non-Price Spatial Competition Model
AUTHORS: Yosuke Yasuda
KEYWORDS: Hotelling Model; Multiple Locations; The Principle of Minimization
JOURNAL NAME: Theoretical Economics Letters, Vol.3 No.3A, June 18, 2013
ABSTRACT: This note analyzes a slightly modified Hotelling model in which two firms are allowed to choose multiple store locations. Each firm can endogenously choose the number of stores while opening a store incurs a set-up cost. We show that the principle of minimum differentiation, i.e., both firms open a store each on the center, never holds when the set-up cost is decreasing in the number of stores. Under general cost functions that include non-linear and asymmetric set up costs, we characterize the conditions under which the principle holds. General payoff functions that are non-linear in the market share are also considered.