Strategic entry deterrence.
Entrant
Incumbent
Stay out
Enter
Fight
Share
(
π
M
-C,
0
)
(
π
W
,
π
W
)
(
π
S
-C,
π
S
)
w
Does this mean that strategic commitments save
the Bain-Sylos account of barriers to entry?
w
Notice that, because of the
commitment, the incumbent
no longer
has the same costs as the entrant
.
