Competitive Pressure: Competitive Dynamics as Reactions to Multiple Rivals

Leon Zucchini and Tobias Kretschmer

Discussion Papers in Business Administration from University of Munich, Munich School of Management

Abstract: Competitive dynamics research has focused primarily on interactions between dyads of firms. Drawing on the awareness-motivation-capability framework and strategic group theory we extend this by proposing that firms’ actions are influenced by perceived competitive pressure resulting from actions by several rivals. We predict that firms’ action magnitude is influenced by the total number of rival actions accumulating in the market, and that this effect is moderated by strategic group membership. We test this using data on the German mobile telephony market and find them supported: the magnitude of firm’s actions is influenced by a buildup of actions by multiple rivals, and firms react more strongly to strategically similar rivals.

Keywords: Competitive rivalry; competitive dynamics; strategic groups; mobile telecommunications (search for similar items in EconPapers)
JEL-codes: D22 D83 L11 M10 (search for similar items in EconPapers)
Date: 2011-08
New Economics Papers: this item is included in nep-bec, nep-com and nep-cse
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Competitive Pressure: Competitive Dynamics as Reactions to Multiple Rivals (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:lmu:msmdpa:12308

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