Entry Selection

J.J.A. Kamphorst, E. Mendys-Kamphorst, B. Westbrock

Research output: Working paperAcademic


It is well-known in the IO literature that incumbent firms maywant to deter entry by behaving as if they are efficient. In this paper we showthat incumbents may sometimes prefer to encourage entry by mimicking thebehaviour of a less efficient firm for the following reason.If the incumbent cannot deter potential efficient entrants, he may want toelicit entry by an inefficient firm who would not enter if he knows that theincumbent is efficient. The presence of the additional firm in the market preventsfurther entry. The incumbent then faces a less efficient competitor in the longrun.
Original languageEnglish
Place of Publicationonbekend
PublisherUU USE Tjalling C. Koopmans Research Institute
Number of pages11
Publication statusPublished - 2010

Publication series

NameDiscussion Paper Series / Tjalling C. Koopmans Research Institute
ISSN (Electronic)2666-8238


  • Duopoly competition
  • entry deterrence
  • signalling weakness


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