Competitor-oriented Objectives: The Myth of Market Share
Competitor-oriented objectives, such as market-share targets, are promoted by academics and are common in business. A 1996 review of the evidence indicated that this violation of economic theory led to reduced profitability. We summarize the evidence as of 1996 then describe evidence from 12 new studies. All of the evidence supports the conclusion that competitor-oriented objectives are harmful. However, this evidence has had only a modest impact on academic research and it seems to be largely ignored by managers. Until this situation changes, we expect that many firms will continue to use competitor-oriented objectives to the detriment of their profitability.
|Date of creation:||Jul 2005|
|Contact details of provider:|| Postal: PO Box 11E, Monash University, Victoria 3800, Australia|
Phone: +61 3 99052489
Fax: +61 3 99055474
Web page: http://business.monash.edu/econometrics-and-business-statistics
More information through EDIRC
|Order Information:|| Web: http://business.monash.edu/econometrics-and-business-statistics Email: |
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mueller, Dennis C., 1992. "The corporation and the economist," International Journal of Industrial Organization, Elsevier, vol. 10(2), pages 147-170, June.
- Charles Abramson & Imran S. Currim & Rakesh Sarin, 2005. "An Experimental Investigation of the Impact of Information on Competitive Decision Making," Management Science, INFORMS, vol. 51(2), pages 195-207, February.
- JS Armstrong & Fred Collopy, 2004. "Effects of Objectives and Information on Managerial Decisions and Profitability," General Economics and Teaching 0412014, EconWPA.
- Anterasian, Cathy & Graham, John L., 1989. "When it's good management to sacrifice market share," Journal of Business Research, Elsevier, vol. 19(3), pages 187-213, November.
- JS Armstrong, 2004. "Peer Review for Journals: Evidence on Quality Control, Fairness, and Innovation," General Economics and Teaching 0412027, EconWPA.
- Arnett, Dennis B. & Hunt, Shelby D., 2002. "Competitive Irrationality: The Influence of Moral Philosophy," Business Ethics Quarterly, Cambridge University Press, vol. 12(03), pages 279-303, July.
- Morton Deutsch, 1958. "Trust and suspicion," Journal of Conflict Resolution, Peace Science Society (International), vol. 2(4), pages 265-279, December.
- Buzzell, Robert D., 2004. "The PIMS program of strategy research: A retrospective appraisal," Journal of Business Research, Elsevier, vol. 57(5), pages 478-483, May.
- Ulf G. Marks & Sönke Albers, 2001. "Experiments In Competitive Product Positioning : Actual Behavior Compared To Nash Solutions," Schmalenbach Business Review (sbr), LMU Munich School of Management, vol. 53(3), pages 150-174, July.
- JS Armstrong & Roderick J. Brodie, 2004. "Effects of Portfolio Planning Methods on Decision Making: Experimental Results," General Economics and Teaching 0412016, EconWPA.
- Alvin Scodel & J. Sayer Minas & Philburn Ratoosh & Milton Lipetz, 1959. "Some descriptive aspects of two-person non-zero-sum games," Journal of Conflict Resolution, Peace Science Society (International), vol. 3(2), pages 114-119, June.
- JS Armstrong & Raymond Hubbard, 2005. "Does the Need for Agreement Among Reviewers Inhibit the Publication of Controversial Findings?," General Economics and Teaching 0502052, EconWPA.