Price Wars Caused by Switching Costs
分析一个四期完全信息模型，研究存在转换成本的市场中，新企业进入如何引发价格战，并区分两种价格战类型，解释其取决于转换成本大小。
In many markets consumers have "switching costs", for example learning costs or transaction costs, of changing between functionally equivalent brands of a product, or of using any brand for the first time. We analyse a four-period complete-information model of a market with switching costs in which new entry occurs after the second period. The new entry results, in equilibrium, in a price war. That is, the new entrants' prices are higher in the post-entry period than in the entry period, and the incumbent's price falls in either the pre-entry period or the entry period and subsequently rises. We can interpret the incumbent's lowering its price in the pre-entry period as limit-pricing behaviour. We distinguish between two types of price war that can occur, and show how the type or mixture of types that arises depends on the size of switching costs.