Petrakis, Emmanuel; Rasmusen, Eric; Roy, Santanu - In: RAND Journal of Economics 28 (1997) 2, pp. 248-268
We consider the learning curve in an industry with free entry and exit and price-taking firms. A unique equilibrium exists if the fixed cost is positive. Although equilibrium profits are zero, mature firms earn rents on their learning, and if costs are convex, no firm can profitably enter after...