Didier Baudewyns

Spatial Competition within Urban Areas: Hotelling and Bertrand Reconciled

In this paper, I assume the existence of distribution of urbanamenities having its maximum at the city center. These amenities are viewed as a surrogate for all kinds of outside opportunities taht consumers encounter within urban areas. Using the Hotelling model, I study the impact of these amenities on independent location and pricing decisions of duopolists. Consumers patronize the firm where the amount of aminities is larger, ceteris paribus. If this demand externality is strong at the midpoint then minimum differentiation occurs without moderation of price competition, in contrast to mainstream results in the literature. For intermediate values of the ration of transportation cost to spatial concentration of amenities, firms tacitly play an asymmetric equilibrium with one firm near (or at) the midpoint and its rival at a more suburban location. This causes intra-urban inequalities since some consumers are induted to patronize the decentralized marketplace where they encounter less urban life opportunities.

An Analysis of the Housing Market in Greater Brussels

This chapter presents an analysis of the housing market in the greater Brussels area. On June 18, 1989, with the election of its first parliament, the region of Brussels-capital (19 centralised ‘communes’ or municipalities with almost 1 million inhabitants) was created. On January 1, 1995, it was removed from the province of Brabant in order to get more autonomy. The Parliament of BCR is in fact a regional council that may vote orders, but not decrees (or laws a fortiori). The remaining part of the old province of Brabant was itself split into two independent provinces: Flemish Brabant and Walloon Brabant that have been incorporated into, respectively, Flanders – 5.9 millions inhabitants, one of the most prosperous regions in Europe – and Wallonia (3.3 millions inhabitants), the traditional manufacturing-based region. The area analysed in the next sections is defined as three NUTS regions (NUTS code in parenthesis): Brussels-capital region (BE 1), Flemish Brabant (BE 24) and Walloon Brabant (BE 31). The entire district of Hal-Vilvoorde and some northwestern municipalities of Nivelles (such as Waterloo) are the immediate suburbs of Brussels. Leuven (eastwards) and a majority of municipalities of the district of Nivelles (southwards) are more distant outskirts of the capital city, Brussels (see the map below). For purpose of exposition, let us adopt the following notations:

Urban Public Facility Location, Multipurpose Trips and Spatial Competition: equilibrium and welfare analysis

We study the impact of the urban location of one single public facility on spatial competition ` la Hotelling. If transportation costs are very low compared to the value of the public service then both firms tacitly choose the facility location without moderation of price competition, in contrast to mainstream results in the literature. In this event, minimum differentiation is efficient. For intermediate values of the relative transportation rate, inefficient partially-dispersed equilibria emerge with one firm at the facility site while its competitor locates at one end of the linear city. We also analyze the welfare impacts of changes, successively, in the facility location and the transportation rate, taking into account firms relocations.