Market Entry, Fighting Brands, and Tacit Collusion: Evidence from the French Mobile Telecommunications Market

• 成果类型: Article
• 署名作者: Bourreau, Marc; Sun, Yutec; Verboven, Frank
• 署名单位: IMT - Institut Mines-Telecom; Institut Polytechnique de Paris; Telecom Paris; Ecole Nationale de la Statistique et de l'Analyse de l'Information (ENSAI); KU Leuven; Centre for Economic Policy Research - UK
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20190540
• 发表日期: 2021
• 页码: 3459-3499
• 关键词: product variety; switching costs; demand models; mergers; performance; COMPETITION; TELEPHONY; expansion

摘要

We study a major new entry in the French mobile telecommunications market, followed by the introduction of fighting brands by the three incumbents. Using an empirical oligopoly model, we find that the incumbents' fighting brand strategies are difficult to rationalize as unilateral best responses. Instead, their strategies are consistent with a breakdown of tacit semi-collusion: before entry, the incumbents could successfully coordinate on restricting product variety to avoid cannibalization; after entry, this outcome became harder to sustain because of increased business stealing incentives. Consumers gained considerably from the added variety and, to a lesser extent, from the incumbents' price responses.