1 of 22

2024.6.18 / 발표자 : 박희준

Entry with two correlated signals : �the case of industrial espionage and its positive competitive effects

​

​

International Journal of Game theory(2021)

Alex Barrachina, Yair Tauman, Amparo Urbano

2 of 22

Ⅰ. Related literature : Limit pricing by Milgrom and Roberts’(MR) 1982

  • In complete information, incumbent firm’s pre-entry actions do not influence post-entry costs and demand like Friedman’s argument. However in incomplete information case, it can be changed.

​

  • Lower price (by signaling lower costs) tends to discourage entry.

​

  • Incumbent attempts to influence the entry decision by charging a pre-entry price which is below the simple monopoly level.

​

  • In separating equilibrium, limit pricing will not limit entry.

3 of 22

Ⅱ. Model

 

4 of 22

 

Ⅱ. Model

Ⅱ. Model

5 of 22

Ⅱ. Model

 

Ⅱ. Model : Three-stage game

6 of 22

Ⅱ. Model

 

Ⅱ. Model

7 of 22

 

Ⅱ. Model

8 of 22

Ⅱ. Model

 

Ⅱ. Model

9 of 22

Ⅱ. Model

 

Ⅱ. Model

10 of 22

Ⅱ. Model

 

Ⅱ. Model

11 of 22

Ⅲ. Conditions for limit pricing : entry rule

 

►► The signal sent by the IS is informative, and E will be more inclined to enter the market when receiving

signal h than when receiving signal l.

12 of 22

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

 

13 of 22

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

 

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

14 of 22

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

 

15 of 22

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

 

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

16 of 22

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

 

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

17 of 22

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

 

Ⅳ-1. Conditions for entry deterrence : pooling equilibria

18 of 22

 

 

 

19 of 22

 

 

 

20 of 22

 

 

21 of 22

Ⅴ. Separating equilibrium

 

22 of 22

Ⅴ. Contribution

  • Show pooling equilibria even under ex-ante profitable entry.
  • Positive likelihood of market entry even under ex-ante non-profitable entry.
  • Pooling equilibria exist for intermediate values of IS precision, where E enters the market if the IS indicates that the cost of M is high.
  • Separating equilibria of this model are not affected by espionage by E.
  • Same results as Milgrom and Roberts’ 1982