Munich Personal RePEc Archive

Optimal Price of Entry into a Competition

Ginzburg, Boris (2019): Optimal Price of Entry into a Competition.

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Abstract

A continuum of agents are choosing whether to enter a competition. Entry is controlled by a firm that charges a price for it. The mass of agents is uncertain. I analyse how the distribution of the mass of agents determines the equilibrium price and the intensity of entry. A shift of the distribution towards more mass initially induces a reduction of price, and later – a reduction in entry.

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