Electronic Resource
Oxford, UK and Boston, USA
:
Blackwell Publishers Ltd
Metroeconomica
53 (2002), S. 0
ISSN:
1467-999X
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Economics
Notes:
The severity of selection mechanisms and the myopia of selection are explored through a duopoly model where one firm tries to move down a learning curve in which costs are initially higher than its rival's but ultimately much lower. A trade-off is found between catch-up time and asymptotic market share: the more severe are selection pressures, the less likely is it that the learning technology will survive; however, if it does survive, the learning technology will in the limit be more competitive the more severe are selection pressures. We explore the dynamics of the model under unit cost and strategic pricing and find that the optimal pricing rule depends on the parameters governing firm learning and market selection.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/1467-999X.00139
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