Acquisitions, entry, and innovation in oligopolistic network industries

Pehr Johan Norbäck, Lars Persson, Joacim Tåg

Forskningsoutput: TidskriftsbidragArtikel i vetenskaplig tidskriftPeer review

Sammanfattning

In industries with network effects, incumbents' installed bases create barriers to entry that discourage entrepreneurs from developing new innovations. Yet, entry is not the only commercialization route for entrepreneurs. We show that the option of selling to an incumbent increases the innovation incentives for entrepreneurs when the network effects are strong and incumbents compete to preemptively acquire innovations. Thus, we establish that network effects and installed bases do not necessarily restrict the innovation incentives and that network effects promote acquisitions over entry.

Originalspråkengelska
Sidor (från-till)1-12
Antal sidor12
TidskriftInternational Journal of Industrial Organization
Volym37
Nummer1
DOI
StatusPublished - 2014 jan. 1
Externt publiceradJa

Ämnesklassifikation (UKÄ)

  • Nationalekonomi

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