Retail location competition under carbon penalty

Dilek, Hande; Karaer, Özgen; Nadar, Emre

doi:10.1016/j.ejor.2017.10.060

Cited by 22 publications

(1 citation statement)

References 35 publications

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“…Now we consider the profit functions of the firms. As in Matsushima (2004) [18] and Dilek et al (2018) [37], we assume that the transportation costs endogenously depend on the demand faced by the firms, that is shipping is relative to each unit. 12 Therefore, the profits of Firms A and B are, respectively: 13…”

Section: Equilibrium Outcome With Complete Outsourcingmentioning

confidence: 99%

Location of Firms and Outsourcing

Colombo,

Mukherjee

2023

Games

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We analyze the location of final goods producers under spatial competition with strategic input price determination by firm-specific input suppliers when the final goods producers undertake complete outsourcing or bi-sourcing. Under complete outsourcing, the final goods producers locate closer as the distance between the input suppliers decreases, but the distance between the final goods producers may increase or decrease with the transportation costs of the consumers and the transportation costs between the input suppliers and the final goods producers depending on the distance between the input suppliers. The possibility of bi-sourcing reduces the benefit from saving the transportation costs between the input suppliers and the final goods producers, and creates effects which are opposite to those under complete outsourcing. Thus, our results differ significantly from the extant literature considering either no strategic input price determination or strategic input price determination under competition in the input market. We also discuss the implications on the profits, consumer surplus and welfare, and the implications of endogenous location choice of the input suppliers.

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Section: Equilibrium Outcome With Complete Outsourcingmentioning

confidence: 99%