Perfect and Imperfect Competition in Land/Housing Markets
As discussed in Sect. 2.1.1, land and housing demand has been extensively modelled in economics as a key part of the field of ‘urban economics’ developed by Mills, Alonso and others. However, the modelling of the supply of land and associated housing has been studied much less. This has occurred probably for two main reasons (i) the difficulty of modelling the oligopolistic nature of these markets and (ii) the occurrence of several sets of agents in the process whose behaviour is interdependent. In this chapter, an attempt is made to meet these two challenges. It draws directly from joint research performed by the author and Professor Francisco Martinez, University of Chile, who has led this work.1
KeywordsDemand Function Supply Function Imperfect Competition Unconstrained Model Land Developer
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