IDEAS home Printed from https://ideas.repec.org/a/kap/theord/v81y2016i4d10.1007_s11238-016-9551-2.html
   My bibliography  Save this article

Multiple rounds in a chain store game

Author

Listed:
  • Michael Melles

    (Helvetia Insurances)

  • Rainer Nitsche

    () (E.CA Economics and European School of Management and Technology)

Abstract

Abstract In textbook models of reputation, a number of entry games are played sequentially. A multimarket incumbent—the chain store—deters entry of “early” small entrants with a threat of predation. In the last markets of the game, entry occurs stochastically. We show that this stochastic entry is due to a restrictive assumption and vanishes if entrants that initially decided to stay out are allowed to reconsider their decision following entry elsewhere.

Suggested Citation

  • Michael Melles & Rainer Nitsche, 2016. "Multiple rounds in a chain store game," Theory and Decision, Springer, vol. 81(4), pages 571-579, November.
  • Handle: RePEc:kap:theord:v:81:y:2016:i:4:d:10.1007_s11238-016-9551-2
    DOI: 10.1007/s11238-016-9551-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11238-016-9551-2
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kreps, David M. & Wilson, Robert, 1982. "Reputation and imperfect information," Journal of Economic Theory, Elsevier, vol. 27(2), pages 253-279, August.
    2. Milgrom, Paul & Roberts, John, 1982. "Predation, reputation, and entry deterrence," Journal of Economic Theory, Elsevier, vol. 27(2), pages 280-312, August.
    3. Masso, Jordi, 1996. "A Note on Reputation: More on the Chain-Store Paradox," Games and Economic Behavior, Elsevier, vol. 15(1), pages 55-81, July.
    4. Drew Fudenberg & David M. Kreps, 1987. "Reputation in the Simultaneous Play of Multiple Opponents," Review of Economic Studies, Oxford University Press, vol. 54(4), pages 541-568.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Multimarket Firms; Entry; Predation; Reputation;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:theord:v:81:y:2016:i:4:d:10.1007_s11238-016-9551-2. 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: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.springer.com .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.