Pioneer, early follower or late entrant: Entry dynamics with learning and market competition

Chia-Hui Chen, Junichiro Ishida and Arijit Mukherjee

European Economic Review, 2023, vol. 152, issue C

Abstract: Timing of market entry is one of the most important strategic decisions a firm must make, but its decision process becomes convoluted with information and payoff externalities. The threat of competition pushes firms to enter earlier to preempt their rivals while the possibility of learning makes them cautiously wait for others to take action. This combination amounts to a new class of timing games where a first-mover advantage first emerges as in preemption games but a second-mover advantage later prevails as in wars of attrition. Our model identifies under what conditions a firm becomes a pioneer, early follower or late entrant and provides efficiency implications by highlighting an elusive link between static market competition and dynamic entry competition.

Keywords: Market entry; Market competition; Private learning; Signaling; Preemption; Consumer inertia (search for similar items in EconPapers)
JEL-codes: D82 D83 L13 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0014292122002409
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Pioneer, Early Follower or Late Entrant: Entry Dynamics with Learning and Market Competition (2021)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:152:y:2023:i:c:s0014292122002409

DOI: 10.1016/j.euroecorev.2022.104360

Access Statistics for this article

European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer

More articles in European Economic Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().