In a declining industry, shrinking demand creates pressure for capacity to be reduced. Who exits first? There is a unique perfect equilibrium for firms with asymmetric market shares and identical unit costs in which survivability is inversely related to size: the largest firm can profitably...

Choice settings are strategic to the extent that they entail cross-sectional or intertemporal linkages. These same factors may impose daunting demands on decision makers. We develop a graph-theoretic generalization of the NK model of fitness landscapes to model the way in which policy choices...

Agglomeration in foreign direct investment (FDI) is typically attributed to location-specific characteristics such as natural resource advantages or production-related spillovers between multinational firms. The increasing collocation of the largest global firms in the cement industry since the...

Recent years have seen a surge of interest among industrial organization economists in using data on international trade flows as windows into competitiveness. For countries that are at least mid-sized (e.g., Spain), interregional trade tends to be as large as or significantly larger than...

Game theory has come to dominate industrial organization economics, but business strategists continue to debate its usefulness. So far, empirical work on the application of game theory to business strategy has been too limited to force a consensus. As a (partial) remedy, Games Businesses Play...

Diversified business groups dominate the private sectors of most of the world's economies. Several of these economies have undergone sudden policy changes that significantly increase domestic competitive intensity. The authors demonstrate how the changes in corporate scope that accompany such...

This paper analyzes a dynamic mixed duopoly in which a profit-maximizing competitor interacts with a competitor that prices at zero (or marginal cost), with the cumulation of output affecting their relative positions over time. The modeling effort is motivated by interactions between Linux, an...

If markets were either completely isolated by or integrated across borders, there would be little room for international business strategy to have content distinctive from ‘mainstream’ strategy. But a review of the economic evidence about the international integration of markets indicates...

This paper studies a new frontier in the understanding of International Strategy (IS). To explore it, we propose the analogy of the ecology of firms and places as a way to emphasize that the real problem is the colocation of different places with different types of firms. Locations are in fact...