Imminent entry and the transition to multimarket rivalry in a laboratory setting

• Autores: Charles F. Mason, Owen R. Phillips
• Localización: Journal of Economics & Management Strategy, ISSN-e 1530-9134, Vol. 25, Nº. 4, 2016, págs. 1018-1039
• Idioma: inglés
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• Resumen

  • In this paper we study the behavior of rivals when there is a known probability of imminent entry. Experimental markets are used to collect data on pre- and postentry production when there is an announced time of possible entry; some markets experience entry and other do not. In all preentry markets competition is more intense. Postentry behavior in all markets is more competitive compared to a baseline that had no threat. There is evidence that postentry multimarket contact raises outputs in those markets that did not experience entry, behavior we generally refer to as a conduit effect. [ABSTRACT FROM AUTHOR]