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Sunk costs, entry and clustering

Research output: Contribution to Journal/Magazine › Journal article › peer-review

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Sunk costs, entry and clustering. / Matros, Alexander; Smirnov, Vladimir; Wait, Andrew.
In: Economic Theory, 31.05.2023.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Matros, A, Smirnov, V & Wait, A 2023, 'Sunk costs, entry and clustering', Economic Theory. https://doi.org/10.1007/s00199-023-01504-1

APA

Matros, A., Smirnov, V., & Wait, A. (2023). Sunk costs, entry and clustering. Economic Theory. Advance online publication. https://doi.org/10.1007/s00199-023-01504-1

Vancouver

Matros A, Smirnov V, Wait A. Sunk costs, entry and clustering. Economic Theory. 2023 May 31. Epub 2023 May 31. doi: 10.1007/s00199-023-01504-1

Author

Matros, Alexander ; Smirnov, Vladimir ; Wait, Andrew. / Sunk costs, entry and clustering. In: Economic Theory. 2023.

Bibtex

@article{408cfccc2e224e01ace47b8f61c66f9b,
title = "Sunk costs, entry and clustering",
abstract = "We examine how differences in firm sunk entry costs affect both entry order and the potential for clustering in a triopoly preemption game. If the cost asymmetry between the firms is sufficiently large, the firms always enter in the order from the lowest to highest cost, whereas if firms are relatively symmetric, it is possible that the second-highest cost firm enters first. There is never clustering of entry when there is any difference in cost between the two most productively efficient firms. Lastly, when the cost asymmetry between firms is large, the leader{\textquoteright}s entry time in the triopoly is always earlier than it is in a duopoly.",
keywords = "Economics and Econometrics",
author = "Alexander Matros and Vladimir Smirnov and Andrew Wait",
year = "2023",
month = may,
day = "31",
doi = "10.1007/s00199-023-01504-1",
language = "English",
journal = "Economic Theory",
issn = "0938-2259",
publisher = "Springer-Verlag,",

}

RIS

TY - JOUR

T1 - Sunk costs, entry and clustering

AU - Matros, Alexander

AU - Smirnov, Vladimir

AU - Wait, Andrew

PY - 2023/5/31

Y1 - 2023/5/31

N2 - We examine how differences in firm sunk entry costs affect both entry order and the potential for clustering in a triopoly preemption game. If the cost asymmetry between the firms is sufficiently large, the firms always enter in the order from the lowest to highest cost, whereas if firms are relatively symmetric, it is possible that the second-highest cost firm enters first. There is never clustering of entry when there is any difference in cost between the two most productively efficient firms. Lastly, when the cost asymmetry between firms is large, the leader’s entry time in the triopoly is always earlier than it is in a duopoly.

AB - We examine how differences in firm sunk entry costs affect both entry order and the potential for clustering in a triopoly preemption game. If the cost asymmetry between the firms is sufficiently large, the firms always enter in the order from the lowest to highest cost, whereas if firms are relatively symmetric, it is possible that the second-highest cost firm enters first. There is never clustering of entry when there is any difference in cost between the two most productively efficient firms. Lastly, when the cost asymmetry between firms is large, the leader’s entry time in the triopoly is always earlier than it is in a duopoly.

KW - Economics and Econometrics

U2 - 10.1007/s00199-023-01504-1

DO - 10.1007/s00199-023-01504-1

M3 - Journal article

JO - Economic Theory

JF - Economic Theory

SN - 0938-2259

ER -