Advanced Search
MyIDEAS: Login

An Empirical Analysis of Dynamic, Nonprice Competition in an Oligopolistic Industry

Contents:

Author Info

  • Mark J. Roberts
  • Larry Samuelson

Abstract

This article develops a dynamic model of nonprice competition in an oligopolistic industry and uses it to analyze advertising competition in the U.S. cigarette industry. The model generalizes existing studies by allowing advertising to affect both firm market shares and the total size of the market. The model also allows dynamic conjectural variations to arise from the intertemporal links created by the durability of advertising. We use these dynamic conjectural variations to distinguish alternative models of competitive interaction. We estimate the complete model of firm production, demand, and advertising choice by using data for U.S. cigarette producers. The results indicate that firm advertising primarily affects the level of market demand, with a firm's effect on rival firms' market shares arising through variations in the number of brands sold. Empirical results on firm behavior suggest that firms act as if their advertising choices will alter the future advertising choices of rival firms in both the high-tar and low-tar cigarette markets.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://links.jstor.org/sici?sici=0741-6261%28198822%2919%3A2%3C200%3AAEAODN%3E2.0.CO%3B2-W&origin=repec
File Function: full text
Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by The RAND Corporation in its journal RAND Journal of Economics.

Volume (Year): 19 (1988)
Issue (Month): 2 (Summer)
Pages: 200-220

as in new window
Handle: RePEc:rje:randje:v:19:y:1988:i:summer:p:200-220

Contact details of provider:
Web page: http://www.rje.org

Order Information:
Web: https://editorialexpress.com/cgi-bin/rje_online.cgi

Related research

Keywords:

Other versions of this item:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:rje:randje:v:19:y:1988:i:summer:p:200-220. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.