search query: @author Lazear, E. P. / total: 11
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| Author: | Aron, D. J. Lazear, E. P. |
| Title: | The introduction of new products |
| Journal: | American Economic Review
1990 : MAY, VOL. 80:2, p. 421-426 |
| Index terms: | INDUSTRIES NEW PRODUCTS MARKETS STOCHASTIC PROCESSES PRODUCT LIFE CYCLE |
| Language: | eng |
| Abstract: | It was pointed out that new markets are likely to be opened up by new entrants, and firms that are less dominant in existing markets. Entry decisions by new firms and counters by incumbents are not always efficient. These and related issues are examined by the model used in the stochastic version of the analysis. Results from the deterministic version, that incorporates cannibalisation and diseconomics of scope, will be referenced. The stochastic model makes two points: first, firms that are behind seek variances and the introduction of new products provides a desired variance, second, the industry's dominant firm is likely to follow. Therefore, products tend to be introduced by more than one firm simultaneously. |
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