Market Size and Number of Firms with New Technology

Sugata Marjit, Krishnendu Dastidar and Gouranga Das

No 9934, CESifo Working Paper Series from CESifo

Abstract: In this paper, unlike the conventional wisdom, we demonstrate that the relationship between the size of the market and number of firms would be non-monotonic. While moderate rise in the size would force the local firms to exit and only the foreign firm rules, substantial rise in the size would accommodate all firms. Also, the possibility of survival increases if the local firms could differentiate their product more and then we drift towards the conventional result.

Keywords: product differentiation; free entry; Cournot; output; market size; technology; FDI (search for similar items in EconPapers)
JEL-codes: D40 F10 L13 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind, nep-int and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_9934

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