Some spatial equilibria in facility investment under uncertain demand

This paper describes the spatial distribution of customer demand, supply of customer services and facility investment, as the outcome of a three-level game-like interaction between customers (e.g., shoppers), suppliers (e.g., retailers) and developers (e.g., landlords). Treating both the suppliers and developers at each centre as competitors, oligopolistic equilibria of the Nash-Stackelberg type are developed, and conditions for their existence and uniqueness established. Uncertain customer demand is specified in probabilistic terms, representing the suppliers' perception of expected customer behaviour.