Market entry dynamics with a second-mover advantage

Vladimir Smirnov*, Andrew Wait

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

3 Citations (Scopus)


We study a market-entry game with a second-mover advantage. In the symmetric equilibrium, there can be a non-monotonic relationship between the probability with which a player will invest (entry) and the length of time until the deadline. Moreover, the probability of investment can move chaotically as the horizon is extended. In the limit when the period length goes to zero chaotic trajectories arise when the efficiency effect does not hold - that is, when the one-period monopoly profit is less than the total of the one-period duopoly profits. We also show that the presence of chaotic trajectories is associated with a smaller expected delay in entry.

Original languageEnglish
Article number11
Pages (from-to)1-23
Number of pages23
JournalB.E. Journal of Theoretical Economics
Issue number1
Publication statusPublished - 2007


  • Deterministic chaos
  • Market entry
  • Mixed strategy
  • Second-mover advantage

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