Price Patterns Resulting from Different Producer Behavior in Spatial Equilibrium

Spatial Price Equilibrium

Producer price highlights, 1998

Selection Effects in Producer-Price Setting

We use micro data on product prices linked to information on the firms that set them to test for selection effects (state dependence) in micro-level producer pricing. In contrast to using synthetic data from a canonical menu-cost model, we find very weak, if any, micro-level selection effects when running price change probability regressions on actual data. Moreover, when fitting a model that n...

Sensitivity analysis for time dependent spatial price equilibrium problem

We present some sensitivity results for the spatial price equilibrium problem in the case of quantity formulation model and in presence of excess supply and excess demand. The equilibrium conditions that describe the above model are expressed in terms of a time dependent variational inequality. The variational inequality formulation plays a fundamental role in order to achieve the sensitivity r...

Formulation and Analysis of a Dynamic Spatial Price Equilibrium Model

The spatial price equilibrium model begins with the Hitchcock-Koopmans transportation problem as described by Dantzig (1963). The data for this model includes a set of suppliers I and a set of markets J , with supplies ai, demands bj, transport costs cij from supplier i to market j. Cast as a planning problem, this linear program seeks a transport schedule which minimizes the cost of supplying ...