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SUMMARY:MARKET ENTRY\, FIGHTING BRANDS AND TACIT COLLUSION: THE CASE OF TH
 E FRENCH MOBILE TELECOM MARKET - Frank Verboven\, KU Leuven
DTSTART:20190227T130000Z
DTEND:20190227T140000Z
UID:TALK118504@talks.cam.ac.uk
CONTACT:Emily Brown
DESCRIPTION:We study a major new entry in the French mobile telecommunicat
 ions market\, followed by the introduction of fighting brands by the three
  incumbent firms.\n\nUsing an empirical oligopoly model with differentiate
 d products\, we show that the incumbents’ launch of the fighting brands 
 can be rationalised only as a breakdown of tacit collusion.\n\nIn the abse
 nce of entry the incumbents successfully colluded on restricting their pro
 duct variety to avoid cannibalisation\; the new entry of the low-end compe
 tition made such semi-collusion more difficult to sustain because of incre
 ased business stealing incentives.\n\nConsumers gained considerably from t
 he added variety of the new entrant and the fighting brands\, and to a les
 ser extent from the incumbents’ price response to the entry.
LOCATION:LT4\, Cambridge Judge Business School
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