A duopolistic spatial competition model with non-zero conjectural variation

Consider a two-stage non-cooperative Cournot game with location choice involving two firms. There aren spatially separated markets located at the vertices of a network. Each firm, first selects the location of a facility and then selects the quantities to supply to the markets in order to maximize its profit. Non-zero conjectural variation at the second stage is studied. Equilibrium in the quantities offered by each firm in the markets exists. Furthermore, when the demand in each market is sufficiently large, each firm chooses to locate its facility at the vertices. Partially financed by FEDER and Ministerio de Ciencia y Tecnología, grant BFM2002-04525-C02-01, and Universidad de Las Palmas de Gran Canaria, grant UNI2004/12