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Locating Multiple Competitive Facilities: Spatial Interaction Models with Variable Expenditures

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Abstract

We develop a new framework for location of competitive facilities by introducing non-constant expenditure functions into spatial interaction location models. This framework allows us to capture two key effects – market expansion and cannibalization – within the same model.

We develop algorithmic approaches for finding optimal or near-optimal solutions for several models that arise from choosing a specific form of the expenditure functions.

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Authors and Affiliations

  1. Rotman School of Management, University of Toronto, 105 St. George Street, Toronto, Ontario, Canada, M5S 3E6

    Oded Berman & Dmitry Krass

Authors
  1. Oded Berman
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  2. Dmitry Krass
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Berman, O., Krass, D. Locating Multiple Competitive Facilities: Spatial Interaction Models with Variable Expenditures. Annals of Operations Research 111, 197–225 (2002). https://doi.org/10.1023/A:1020957904442

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  • DOI: https://doi.org/10.1023/A:1020957904442

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