Cost Reducing Investment, Competition and Industry Dynamics

Arbeitspapier

We demonstrate the possibility of shake-out of firms and emergence of inter-firmheterogeneity along the (socially optimal) dynamic equilibrium path of a competitive industry with freeentry and exit, even when there is no uncertainty and all firms are ex ante identical with perfectforesight. Atomistic firms with upward sloping marginal cost curves undertake investment in firm-specific cost reduction. They earn negative net profit in early periods, compensated later by strictlypositive net profits; no entry occurs after the initial time period. Some firms may exit before others evenwhile other firms earn positive net profit.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Tinbergen Institute Discussion Paper ; No. 98-011/1

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Market Structure, Pricing, and Design: Perfect Competition ; Production, Pricing, and Market Structure; Size Distribution of Firms ; Innovation and Invention: Processes and Incentives
• Thema: Cost Reducing Investment ; Industry Dynamics ; Learning ; Competitive Equilibrium ; Shake Out ; Investitionsentscheidung ; Rationalisierung ; Wettbewerb ; Industrie ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Petrakis, Emmanuel ; Roy, Santanu
• Ereignis: Veröffentlichung
• (wer): Tinbergen Institute
• (wo): Amsterdam and Rotterdam
• (wann): 1998

Weitere Informationen

• Handle: http://hdl.handle.net/10419/85409
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ