Entry, Concentration Change, and Stability of Market Shares

Abstract

Traditional theory assigns entry (exit) a prominent role. Yet, there have been relatively few attempts to ascertain, empirically, the effects of actual entry rates.' In particular, we lack good information on the impacts of entry on the structure and performance of industries. This paper considers the impacts of entry on two commonly employed measures of market structure. Specifically, I investigate the relationship between actual rates of net entry, and concentration change and market share stability.