27.2.The Hotelling Model

This video introduces the Hotelling model of product differentiation which predicts that, if price is fixed, two oligopolists will not differentiate their product -- but also suggests that if firms set product characteristics first knowing they will compete on price, they will differentiate their product characteristics.

[@4site_gaming]

Well explained. Thanks 👍

[@Sean-wv1tc]

thank you ve made this model very easy to understand.

[@lawrenceoseafiana]

very easy to understand. Kudos to you

[@elvisboakye8966]

So please what happens if there are more than two firms that want to operate on that same line..how do they split the market?

[@Constantinuous]

Check the "circle model", which a generalization of Hoteling's idea putting firms on a line towards putting them on a circle. Results generalize and we can study also the equilibrium and socially efficient number of entrants that way.

[@adityakumarsingh6402]

I'm confuse if he is left handed or right..

[@natedoggschu]

He has three hands

[@adityakumarsingh6402]

🍌 fir you​@@natedoggschu