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http://hdl.handle.net/10419/46836
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| Title: | | The market entry paradox  |
| Authors: | | Stähler, Frank |
| Issue Date: | | 1996 |
| Series/Report no.: | | Kiel Working Papers 777 |
| Abstract: | | This paper discusses a simultaneous market entry game between two firms with different fixed costs. This case is a typical application of mixed strategy equilibria. Conventional wisdom would suggest that the low-cost firm is more likely to enter the market. This presumption is wrong. Instead, the paper demonstrates a market entry paradox: the equilibrium probability of entry is higher for the high-cost firm than the equilibrium probability of entry of the low-cost firm. |
| Subjects: | | Market entry mixed strategy equilibrium |
| JEL: | | D43 L13 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Publikationen von Forscherinnen und Forschern des IfW Kieler Arbeitspapiere, IfW
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