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New Model Introductions, Cannibalization and Market Stealing: Evidence from Shopbot Data

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  • Michelle Haynes
  • Steve Thompson
  • Peter W. Wright

Abstract

type="main"> Incremental innovation plays an important role in competitive conduct in high-tech industries. This paper explores the impact of new model introduction by employing a nested logit specification to investigate the determination of market shares across and within submarkets for a panel of 336 digital cameras. Our results confirm the existence of pronounced life cycle effects and the existence of statistically significant market stealing and cannibalization effects, particularly associated with the introduction of a technologically superior entrant into the model's market segment. The paper reveals significant differences in market outcomes, in both elasticity and response to entry, across submarkets.

Suggested Citation

  • Michelle Haynes & Steve Thompson & Peter W. Wright, 2014. "New Model Introductions, Cannibalization and Market Stealing: Evidence from Shopbot Data," Manchester School, University of Manchester, vol. 82(4), pages 385-408, July.
    • Handle: RePEc:bla:manchs:v:82:y:2014:i:4:p:385-408
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    File URL: http://hdl.handle.net/10.1111/manc.12024
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    1. Carsten Eckel & Lisandra Flach & Ning Meng, 2023. "Demand and Supply Side Linkages in Exporting Multiproduct Firms," Rationality and Competition Discussion Paper Series 456, CRC TRR 190 Rationality and Competition.

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