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Entry and Competition in a Transition Economy: The Case of Slovakia

  • Martin Lábaj

    ()

    (University of Economics in Bratislava, Faculty of National Economy, Department of Economic Policy)

  • Peter Silaniè

    ()

    (University of Economics in Bratislava, Faculty of National Economy, Department of Economic Policy)

  • Christoph Weiss

The present paper provides first empirical evidence on the effects of entry on market conduct for a transition economy. We estimate size thresholds required to support different numbers of firms for seven retail and professional service industries in a large number of distinct geographic markets in Slovakia. Our results suggest a differential impact of entry on market conduct: while market conduct is unaffected by entry in the north-western parts of Slovakia, competition tends to kick in slowly in most professions in the south-east. This latter region suffers from infrastructure bottlenecks and competitors require a larger increase in the number of customers to come in.

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Paper provided by Department of Economic Policy, Faculty of National Economy, University of Economics in Bratislava in its series Department of Economic Policy Working Paper Series with number 003.

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Length: 17 pages
Date of creation: 31 Jan 2013
Date of revision:
Handle: RePEc:brt:depwps:003
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Web page: http://nhf.euba.sk/katedry/katedra-hospodarskej-politiky

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  1. Bresnahan, T.F & Reiss, P.C., 1989. "Entry And Competition In Concentrated Markets," Papers 151, Stanford - Studies in Industry Economics.
  2. Asplund, Marcus & Sandin, Rickard, 1999. "The Number of Firms and Production Capacity in Relation to Market Size," Journal of Industrial Economics, Wiley Blackwell, vol. 47(1), pages 69-85, March.
  3. Stefan Bojnec & Ana Xavier, 2004. "Entry and exit in transition economies: the Slovenian manufacturing sector," Post-Communist Economies, Taylor & Francis Journals, vol. 16(2), pages 191-214.
  4. Saul Estrin, 2002. "Competition and Corporate Governance in Transition," Journal of Economic Perspectives, American Economic Association, vol. 16(1), pages 101-124, Winter.
  5. Barbara Roberts & Steve Thompson, 2003. "Entry and Exit in a Transition Economy: The Case of Poland," Review of Industrial Organization, Springer, vol. 22(3), pages 225-243, May.
  6. Mariusz Jarmuzek & Biswajit Banerjee, 2009. "Anatomy of Regional Disparities in the Slovak Republic," IMF Working Papers 09/145, International Monetary Fund.
  7. Geroski, P. A., 1995. "What do we know about entry?," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 421-440, December.
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