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Competition Policy and Market Leaders

Ilir Maçi and Kresimir Zigic

CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague

Abstract: We study the potential loss in social welfare and changes in incentives to invest in R&D that result when the market leading firm is deprived of its position. We show that under plausible assumptions like free entry or repeated market interactions there is a social value of market leadership and its mechanical removal by means of competition policy is likely to be harmful for society.

Keywords: Market leaders; Competition policy; Innovation. (search for similar items in EconPapers)
JEL-codes: F12 F13 L11 L13 L16 K21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-cse, nep-ind, nep-ino, nep-ipr, nep-pr~, nep-law, nep-mic and nep-tid
Date: 2008-11
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Journal Article: Competition policy and market leaders (2011) Downloads
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