search query: @author Wang, R. / total: 12
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| Author: | Wang, R. Wen, Q. |
| Title: | Strategic invasion in markets with switching costs |
| Journal: | Journal of Economics and Management Strategy
1998 : WINTER, VOL. 7:4, p. 521-550 |
| Index terms: | ECONOMICS STRATEGY MARKETS |
| Language: | eng |
| Abstract: | The authors investigate the role of consumer switching costs in a three-stage model in which the entrant and the incumbent firm set prices sequentially and then the consumers decide from which firm to buy. The authors characterize the unique subgame perfect equilibrium and find that even an entrant with a higher marginal cost may profitably invade part of the market due to the existence of switching costs. Switching costs benefit both firms but harm consumers. |
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