Entry License Tax: Stackelberg versus Cournot

Sususmu Cato () and Toshihiro Matsumura

Journal of Institutional and Theoretical Economics (JITE), 2019, vol. 175, issue 2, 258-271

Abstract: This study investigates how leadership affects the optimal public policies that impact entry barriers in markets in which the number of firms is endogenously determined. Specifically, we focus on the relationship between the relative efficiency of an incumbent firm and optimal entry tax (entry barrier). We find that this relationship depends on whether the incumbent can commit to its output level before the entries of new firms. The optimal entry tax decreases (increases) with the productivity of the incumbent when it takes (does not take) leadership. We also find that the optimal entry barrier occurring when the incumbent takes leadership is lower than that when it does not.

Keywords: Stackelberg; Cournot; free entry; entry tax; competition policy; beneficial concentration (search for similar items in EconPapers)
JEL-codes: L13 L41 L51 (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.mohrsiebeck.com/en/article/entry-licen ... 101628jite-2019-0015
Fulltext access is included for subscribers to the printed version.

Related works:
Working Paper: Entry-License Tax: Stackelberg versus Cournot (2017)
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:mhr:jinste:urn:doi:10.1628/jite-2019-0015

Ordering information: This journal article can be ordered from
Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany

DOI: 10.1628/jite-2019-0015

Access Statistics for this article

Journal of Institutional and Theoretical Economics (JITE) is currently edited by Gerd Mühlheußer and Bayer, Ralph-C

More articles in Journal of Institutional and Theoretical Economics (JITE) from Mohr Siebeck, Tübingen
Bibliographic data for series maintained by Thomas Wolpert ().