Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/159831
Authors: 
Fontana, Roberto
Zirulia, Lorenzo
Year of Publication: 
2015
Series/Report no.: 
Quaderni - Working Paper DSE 993
Abstract: 
We study the role that switching costs, compatibility, and mergers and acquisitions, play in influencing the evolution of a multi-market industry. By looking at the case of the Local Area Networking industry, we propose a 'history friendly model' to replicate its evolution during the 1990s. Our model explains how a firm can start from a dominant position in one of the existing markets and exploit switching costs and compatibility to enter a new market when it opens. Mergers and acquisitions also play an important role as the new market is pioneered by a new start-up, which is soon acquired by the dominant incumbent. As a result of the acquisition, the acquiring firm becomes leader also in the new market.
JEL: 
O30
L10
L63
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc/3.0/
Document Type: 
Working Paper

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