| By: |
Pavan, Giulia;
Pozzi, Andrea;
Rovigatti, Gabriele |
| Abstract: |
We study the effect of competition on preemption incentives. An unexpected
change in regulation in the Italian retail market for compressed natural gas
fuel allows us to identify the potential entrants and creates exogenous
variation in their number. We document that markets with a larger pool of
potential competitors experience faster entry. We provide evidence suggesting
that this occurs because a larger number of potential entrants raises firms'
incentives to preempt. |
| Keywords: |
potential entrants; preemption; retail fuel market |
| JEL: |
L12 L22 L81 |
| Date: |
2017–06 |
| URL: |
http://d.repec.org/n?u=RePEc:cpr:ceprdp:12113&r=ind |