Consider a market with switching costs that is initially served by a monopolistic incumbent. How can a competitor successfully enter this market? We show that an offer to undercut the incumbent by a fixed margin serves this purpose. This strategy dominates traditional entry where the entrant...

Consider a market with switching costs that is initially served by a monopolistic incumbent. How can a competitor successfully enter this market? We show that an offer to undercut the incumbent by a fixed margin serves this purpose. This strategy dominates traditional entry where the entrant...

Oil price indexing is a peculiar feature of the natural gas markets in Germany and other European countries. It is closely linked to the existence of local monopolies (at least de facto) and of the so called "take-or-pay" (TOP) contracts. After discussing the relation between these features and...

Oil price indexing is a peculiar feature of the natural gas markets in Germany and other European countries. It is closely linked to the existence of local monopolies (at least de facto) and of the so called takeorpayʺ (TOP) contracts. After discussing the relation between these features and...

Consider a market with switching costs that is initially served by a monopolistic incumbent. How can a competitor successfully enter this market? We show that an offer to undercut the incumbent by a fixed margin serves this purpose. This strategy dominates traditional entry where the entrant...

Oil price indexing is a peculiar feature of the natural gas markets in Germany and other European countries. It is closely linked to the existence of local monopolies (at least de facto) and of the so called quot;take-or-payquot; (TOP) contracts. After discussing the relation between these...

In this paper a network model is developed in which three players sequentially choose their strategies. In the first stage, a profit–maximizing network firm chooses the price and thus the size of the network. In the second stage the consumers decide whether to join in the network or not. In...