Judo Economics Reconsidered: Capacity Limitation, Entry and Collusion

Lars Sørgard

Working Papers from Norwegian School of Economics and Business Administration-

Abstract: The capacity investment by a new firm into an established market is explored in a repeated price game. If the entrant expects collusion to prevail upon entry, it may not practice "judo economics" but instead choose to install enough capacity to serve the entire market. This occurs when collusion involves optimal punishment paths.

Keywords: OLIGOPOLIES; INVESTMENTS; GAMES (search for similar items in EconPapers)
JEL-codes: D40 D43 L10 L13 (search for similar items in EconPapers)
Pages: 26 pages
Date: 1995
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Citations: View citations in EconPapers (4)

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Journal Article: Judo economics reconsidered: Capacity limitation, entry and collusion (1997)
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Persistent link: https://EconPapers.repec.org/RePEc:fth:norgee:18/95

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