Title

Endogenous market structure and the cooperative firm

Campus Units

Economics, Center for Agricultural and Rural Development

Document Type

Article

Publication Version

Submitted Manuscript

Publication Date

2014

Journal or Book Title

Economics Letters

Volume

124

Issue

2

First Page or Article ID Number

283

Last Page

285

DOI

10.1016/j.econlet.2014.06.003

Abstract

When the threat of entry by followers includes cooperative firms, the maximum fixed cost that a profit maximizing leader can endure is endogenous. The aggressive strategy required for entry-deterrence curtails the leader’s expected profit and can discourage its initial entry. In such circumstances a cooperative firm may yet be viable, despite having a cost handicap and no first-mover advantage

JEL Classification

L22, P13

Comments

This is a working paper of an article from Economics Letters 124 (2014): 283, doi: 10.1016/j.econlet.2014.06.003.