Does competition make firms enterprising or defensive?
نویسنده
چکیده
4 October 2000 Abstract This paper gives a formalization of defensive and enterprising strategies for firms. It then asks the question whether a rise in competition tends to make firms more enterprising or more defensive. Distinguishing three ways in which competition can be intensified, I find the following results. A rise in the number of opponents and a reduction in opponents’ costs make a firm more defensive. An increase in the aggressiveness of interaction between firms make the top firms in an industry more enterprising while the laggards become more defensive. These results are discussed in the light of the discussion on green production and downsizing.
منابع مشابه
-
The development and evolution of any system–person, organization–nation depends on how the system succeeds to bridge the gap between what the system knows and what the system does (with the knowledge). We call this the gap between knowing and doing or the knowing-doing gap. If the system does not do what it knows, it will lose out in competition with other systems, its relative performance in...
متن کاملExpansion of Location Theories of Firms and Products’ Consistency Using Triangular Distribution Approach
Abstract O ne of the main criticisms of location models is simplistic assumptions concerning the consumers’ distribution on the street or city. The location models usually make use of uniform distribution of consumers while it is not true in reality, and mostly the consumers’ accumulation is more in the city centers rather than suburb areas. This study deals with selectio...
متن کاملCEP Discussion Paper No 966 January 2010 Does Product Market Competition Lead Firms to Decentralize ?
There is a widespread sense that over the last two decades firms have been decentralizing decisions to employees further down the managerial hierarchy. Economists have developed a range of theories to account for delegation, but there is less empirical evidence, especially across countries. This has limited the ability to understand the phenomenon of decentralization. To address the empirical l...
متن کاملFraming Competition∗
We analyze a model of market competition in which two identical firms choose prices as well as how to present, or “frame”, their products. A consumer is randomly assigned to one firm, and whether he makes a price comparison with the other firm is a probabilistic function of the firms’ framing strategies. We analyze Nash equilibria in this model. In particular, we show how the answers to the fol...
متن کاملThe Strategic Use of Consumer Search Cost*
Through their communications mix, firms make decisions that have implications for the ease with which consumers can search for product information. A common intuition is that firms would like to make information easily available to consumers, but choose not to because facilitating consumer search is costly to them. The main result of this paper counters this intuition – firms may not want to ma...
متن کامل