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Article
Advertising and Entry Deterrence: How the Size of the Market Matters
International Journal of Business and Economics (2007)
  • Khaled Bennour, Institut des Hautes Etudes Commerciales de Carthage
Abstract

We analyze the relationship between market size and entry when an incumbent and potentially an entrant compete to gain market share and advertising is the only strategic variable. Entry occurs when the relative effectiveness of incumbent's advertising is smaller than a threshold level that depends on the size of the market. This threshold level is monotonically and positively related to market size. Consequently, equilibrium with entry is more likely the greater is the size of the market.

Keywords
  • advertising; entry; market size
Disciplines
Publication Date
2007
Citation Information
Khaled Bennour. "Advertising and Entry Deterrence: How the Size of the Market Matters" International Journal of Business and Economics Vol. 6 Iss. 3 (2007)
Available at: http://works.bepress.com/khaled_bennour/3/