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Entry and Market Structure

In: Dynamics of Entry and Market Evolution

Author

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  • Jati Sengupta

    (University of California)

Abstract

The dynamics of entry behavior and its impact depend very critically on the type of market structure. If an industry has a large number of competitors and the market is competitive the Walrasian model of entry behavior provides an adequate approximation of the market evolution. However, if the number of firms is small and the market is oligopolistic, the entry behavior follows the strategies of a two-stage or multistage game between the incumbents and the potential entrants. There exist other types of market structures where the dynamics of entry behavior depend on the diffusion of a new technical innovation or a new product. Also in international markets entry occurs through joint ventures.

Suggested Citation

  • Jati Sengupta, 2007. "Entry and Market Structure," Palgrave Macmillan Books, in: Dynamics of Entry and Market Evolution, chapter 4, pages 75-117, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-21101-8_4
    DOI: 10.1057/9780230211018_4
    as

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