Publication
Title
New product introduction and capacity investment by incumbents : effects of size on strategy
Author
Abstract
We analyze a duopoly where capacity-constrained firms offer an established product and have the option to offer an additional new and differentiated product. We show that the firm with the smaller capacity on the established market has a higher incentive to innovate and reaches a larger market share on the market for the new product. An increase in capacity of the larger firm can prevent its competitor from innovating, whereas an increase in capacity of the smaller firm cannot prevent innovation of its larger competitor. In equilibrium the firm with smaller capacity on the established market might outperform the larger firm with respect to total payoffs. (C) 2013 Elsevier B.V. All rights reserved.
Language
English
Source (journal)
European journal of operational research. - Amsterdam
Publication
Amsterdam : 2013
ISSN
0377-2217
Volume/pages
230:1(2013), p. 133-142
ISI
000320211200012
Full text (Publisher's DOI)
Full text (publisher's version - intranet only)
UAntwerpen
Faculty/Department
Research group
Publication type
Subject
Affiliation
Publications with a UAntwerp address
External links
Web of Science
Record
Identification
Creation 04.09.2013
Last edited 15.09.2017
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