Brekke, Kjell Arne; Rege, Mari - 2006
We present a theory of how advertising can break a lock-in by distorting beliefs about market shares in markets with … the lock-in and the incumbent will not advertise at all. However, if the quality differential between the two products is … small, then the incumbent may advertise and make it unpro…table for the entrant to break the lock-in. …