This paper studies the introduction of new products (increase in product variety) in the automobile industry. The focus is on the two sources of market power that may allow the firms to get higher profits (and, thus, recoup investments): new products and brand-name reputation. The effects of new...

Empirical work studying the industry life cycle highlights the role of knowledge in various forms on the durations firms survive in the industry. This research leaves open the influence of historical events, which are reflected in macroeconomic factors like income, inflation, exports and...