Recent years have seen a growing body of literature devoted to the analysis of price advertising. Much of this work argues that price advertising leads to lower prices and is likely to be welfare improving. The questions of how much price advertising takes place and which firms are more likely...

Advertising is widely considered to be an important isolating mechanism through which firms may defend an established competitive advantage. However, there is relatively little empirical evidence on the extent of the strategic use of advertising either to deter or in response to entry. In this...