Bakó, Barna and Kálecz-Simon, András (2014) Strategic segmentation: when two monopolies are better than one. Working Paper. Corvinus University of Budapest Department of Microeconomics. (Unpublished)
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Abstract
In this article we show that the price and the profit of an incumbent firm may increase after a new firm enters its market. Our analysis suggests that a well-established firm after competition emerges on its market might benefit from excluding some consumers from the low- end segment and concentrate only on its loyal consumers. We also find that strategic de-marketing can increase social welfare.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Uncontrolled Keywords: | product differentiation, consumer segmentation, marketing strategy |
| JEL classification: | D43 - Market Structure and Pricing: Oligopoly and Other Forms of Market Imperfection L11 - Production, Pricing, and Market Structure; Size Distribution of Firms M31 - Marketing |
| Divisions: | Faculty of Economics > Department of Microeconomics |
| Subjects: | Economics |
| Funders: | Lendület Fiatal Kutatói Program / Momentum Program of the Hungarian Academy of Sciences |
| Projects: | 'Lendület' Strategic Interactions Group |
| References: | |
| ID Code: | 1729 |
| Deposited By: | Barna Bakó |
| Deposited On: | 07 Nov 2014 12:52 |
| Last Modified: | 07 Nov 2014 12:52 |
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