Strategic Entry and Potential Competition - Evidence from Compressed Gas Fuel Retail
We study the effect of competition on preemption incentives. An unexpected change in regulation in the Italian retail market for compressed natural gas fuel allows us to identify the potential entrants to the market and creates exogenous variation in their number. We document that areas with a larger pool of potential competitors experience faster entry. We provide evidence suggesting that this occurs because facing a higher number of potential entrants raises firms' incentives to preempt.
|Date of creation:||2017|
|Date of revision:||Jun 2017|
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- Austan Goolsbee & Chad Syverson, 2008.
"How Do Incumbents Respond to the Threat of Entry? Evidence from the Major Airlines,"
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- Austan Goolsbee & Chad Syverson, 2004. "How Do Incumbents Respond to the Threat of Entry? Evidence from the Major Airlines," Working Papers 04-04, NET Institute, revised Dec 2004.
- Austan Goolsbee & Chad Syverson, 2005. "How do Incumbents Respond to the Threat of Entry? Evidence from the Major Airlines," NBER Working Papers 11072, National Bureau of Economic Research, Inc.
- Glenn Ellison & Sara Fisher Ellison, 2011. "Strategic Entry Deterrence and the Behavior of Pharmaceutical Incumbents Prior to Patent Expiration," American Economic Journal: Microeconomics, American Economic Association, vol. 3(1), pages 1-36, February.
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- Drew Fudenberg & Jean Tirole, 1985. "Preemption and Rent Equalization in the Adoption of New Technology," Review of Economic Studies, Oxford University Press, vol. 52(3), pages 383-401.
- Mitsuru Igami & Nathan Yang, 2016. "Unobserved heterogeneity in dynamic games: Cannibalization and preemptive entry of hamburger chains in Canada," Quantitative Economics, Econometric Society, vol. 7(2), pages 483-521, 07.
- Argenziano, Rossella & Schmidt-Dengler, Philipp, 2013. "Competition, timing of entry and welfare in a preemption game," Economics Letters, Elsevier, vol. 120(3), pages 509-512.
- Rajshree Agarwal & Barry L. Bayus, 2002. "The Market Evolution and Sales Takeoff of Product Innovations," Management Science, INFORMS, vol. 48(8), pages 1024-1041, August.
- Philipp Schmidt-Dengler, 2006. "The Timing of New Technology Adoption: The Case of MRI," 2006 Meeting Papers 3, Society for Economic Dynamics. Full references (including those not matched with items on IDEAS)
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