Explaining the shakeout process: a successive submarkets model
This paper explains contemporaneous exit and entry in a new industry with a diffusion process across submarkets. It allows a re-interpretation of the shakeout process in some industries in a novel way. The industry is a collection of initially inactive independent submarkets; the timing of their act...
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| Format: | Article |
| Language: | English |
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2009-03-13.
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| Online Access: | Get fulltext |
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|---|---|---|---|
| 001 | 51803 | ||
| 042 | |a dc | ||
| 100 | 1 | 0 | |a Tong, Jian |e author |
| 245 | 0 | 0 | |a Explaining the shakeout process: a successive submarkets model |
| 260 | |c 2009-03-13. | ||
| 856 | |z Get fulltext |u https://eprints.soton.ac.uk/51803/1/pdf | ||
| 520 | |a This paper explains contemporaneous exit and entry in a new industry with a diffusion process across submarkets. It allows a re-interpretation of the shakeout process in some industries in a novel way. The industry is a collection of initially inactive independent submarkets; the timing of their activation is determined by an exogenous aggregate diffusion process. New submarket opening attracts new entry. However, the post-entry endogenous sunk investment requirement induced by innovations also forces much exit to follow entry. The aggregate market thus has overlapping exit and entry; and has a shakeout if the aggregate diffusion process follows a typical S-shape. | ||
| 655 | 7 | |a Article | |