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| Author: | Etro, F. |
| Title: | Stackelberg competition with endogenous entry |
| Journal: | Economic Journal
2008 : OCT, VOL. 118:532, p. 1670-1697 |
| Index terms: | competition endogenous variables entry conditions market structure |
| Language: | eng |
| Abstract: | Endogenous market structures where leaders have a first-mover advantage and entry is endogenous are characterized in this paper. Leaders are always more aggressive than the followers, leaders produce more than any substitutability or complementarity. Under quantity competition, leaders produce more than any follower and the conditions for entry-deterrence (high substitutability and non-increasing marginal costs) are determined here. Leaders tend to set lower prices than the followers under price competition, the opposite than with an exogenous number of companies. |
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