In most mode of entry deterrence, the incumbent engages in predatory practices that harm a potential entrant.

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In most mode of entry deterrence, the incumbent engages in predatory practices that harm a potential entrant. Can these models be reversed, so that the entrant engages in predatory practices? If so then what are the practical differences between incumbents and entrants? Entrants and incumbents roles can be switched in the theoretical models and the results will hold true. If the entrant has deep pockets then it can engage in predatory practices to drive incumbent out. Incumbents have an advantage in that they in most cases would have created brand loyalty or reputation, network externalities, and lower costs due to learning curve. Taking all the above factors into account, it is less likely that entrant will pursue predatory practices.
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Economics of Strategy

ISBN: 978-1118319185

6th edition

Authors: David Besanko, David Dranove, Mark Shanley, Scott Schaefer

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