Postentry Investment and Market Structure in the Chemical Processing Industries
This article analyzes the investment response of incumbents to new entry in 39 chemical product industries. The behavior of incumbents in highly concentrated industries differed from that of incumbents in low-concentration industries. In concentrated industries incumbents increased their rate of investment following entry, but reduced investment to accommodate capacity expansions made by other incumbents. This asymmetric response did not arise in less concentrated industries. Significant excess capacity existed in concentrated industries following entry, but there is little evidence that incumbents built such capacity as a deterrent before entry. Thus, the results support "mobility-deterrence" theories rather than the conventional excess-capacity deterrence argument.
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.
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.
Volume (Year): 18 (1987)
Issue (Month): 4 (Winter)
|Contact details of provider:|| Web page: http://www.rje.org|
|Order Information:||Web: https://editorialexpress.com/cgi-bin/rje_online.cgi|
When requesting a correction, please mention this item's handle: RePEc:rje:randje:v:18:y:1987:i:winter:p:533-549. 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 references are entirely missing, you can add them using this form.