Dynamic Retail Price and Investment Competition
构建了一个零售竞争模型，企业同时选择价格和成本削减投资。均衡中多家相同企业进入后激烈价格竞争，随后出现洗牌，低价低成本企业主导市场。低价与大规模投资互补，主导企业价格随时间上升，但初期可能低于边际成本，不宜简单视为掠夺性定价。
We develop a model of retail competition in which retailers select prices and investments in cost reduction. An equilibrium is constructed in which several identical firms enter and then engage in a phase of vigorous price competition. This phase is concluded with a shakeout, as a low-price, low-cost firm comes to dominate the market. A central feature of the equilibrium is that low prices are complementary with large investments in cost reduction. Even though the dominant firm's price rises through time, and initially may be below marginal cost, we argue that an interpretation of predatory pricing may be inappropriate.