When is entry deterrence the wiser strategy for a firm?

Kazuhiro Ohnishi
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Kazuhiro Ohnishi: Institute for Basic Economic Science, Japan

Philippine Review of Economics, 2005, vol. 42, issue 2, 75-89

Abstract: This paper examines the idea that if an incumbent firm deviates from short-term profit maximization behavior and deters the entry of a potential entrant at the expense of higher profit, then its own mid-/long-term profit maximization is achieved. The paper confirms the importance of the entry-deterrence behavior of the incumbent firm by using numerical examples of learning by doing.

Keywords: entry; deterrence (search for similar items in EconPapers)
JEL-codes: C72 D21 L20 (search for similar items in EconPapers)
Date: 2005
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Persistent link: https://EconPapers.repec.org/RePEc:phs:prejrn:v:42:y:2005:i:2:p:75-89

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