Endogenous Market Structure and the Cooperative Firm

Brent Hueth () and GianCarlo Moschini

Center for Agricultural and Rural Development (CARD) Publications from Center for Agricultural and Rural Development (CARD) at Iowa State University

Abstract: When the threat of entry by followers includes cooperative firms, the maximum fixed cost that a profit maximizing leader can endure is endogenous. The aggressive strategy required for entry deterrence curtails the leader's expected profit and can discourage its initial entry. In such circumstances a cooperative firm may yet be viable, despite having a cost handicap and no first-mover advantage.

Keywords: cooperatives; endogenous entry; entry deterrence; nonconvexity. JEL codes: L22; P13 (search for similar items in EconPapers)
Date: 2014-05
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Related works:
Journal Article: Endogenous market structure and the cooperative firm (2014)
Working Paper: Endogenous market structure and the cooperative firm (2014)
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