Strategic Advance Production Without Stackelberg Leadership

Sougata Poddar () and D. Sasaki

No 667, Department of Economics - Working Papers Series from The University of Melbourne

Abstract: Advance production served as a means of quantity commitment. This paper shows that the pre-emption acts as strategic substitutes between oligopolists. We also show that a firm's incentive for advance production arises only if it has a quantity-setting opponent, irrespective of the firm's own strategic variable (i.e., price or quantity) and the characteristics of the concered products (i.e. substitutes or complements).

Keywords: PRODUCTION CONTROL; INVENTORIES; STOCKS (search for similar items in EconPapers)
JEL-codes: D43 E22 L13 (search for similar items in EconPapers)
Pages: 29 pages
Date: 1998
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Persistent link: https://EconPapers.repec.org/RePEc:mlb:wpaper:667

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