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- W3193733040 abstract "This paper studies a strategic-investment model under endogenous entry of followers. We extend the standard setting à la Etro by incorporating multiple heterogeneous leaders and demand-enhancing investments directly affecting competition. Our findings indicate that all leaders simultaneously restrict entry without harming each other. Moreover, while entry accommodation never arises, a wide range of strategies is consistent with aggressive behavior, including quality upgrades exclusively targeted to high-valuation consumers. By using the tools of aggregative games, we provide conditions over demand primitives to identify when a leader over-invests and whether it (i) raises or lowers its price, (ii) increases or decreases its revenue, and (iii) supplies greater or lower quantities. We illustrate the results by completely characterizing outcomes under the Logit and CES demands." @default.
- W3193733040 created "2021-08-30" @default.
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- W3193733040 date "2021-12-01" @default.
- W3193733040 modified "2023-09-25" @default.
- W3193733040 title "Restricting entry without aggressive pricing" @default.
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- W3193733040 doi "https://doi.org/10.1016/j.rie.2021.08.001" @default.
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