A Bayesian belief network is adopted to structure and manage an entry decision problem, where a potential entrant has to evaluate the profitability of a given market, depending on an established firm's unknown and unobservable multidimensional type. A multiperiod multisignal model is defined to take account of strategic interaction processes between the incumbent and the potential competitor. Since significant theoretical and computational issues prevent us from finding optimal strategies, a myopic policy is discussed that leads to a reasonable outcome. An application example of the proposed solution procedure is also presented.
Reducing information asymmetries in market entry decisions / Domenico, Campisi; Nastasi, Alberto; Reverberi, Pierfrancesco. - In: INTERNATIONAL JOURNAL OF SYSTEMS SCIENCE. - ISSN 0020-7721. - 28:7(1997), pp. 657-667. [10.1080/00207729708929426]
Reducing information asymmetries in market entry decisions
NASTASI, Alberto;REVERBERI, Pierfrancesco
1997
Abstract
A Bayesian belief network is adopted to structure and manage an entry decision problem, where a potential entrant has to evaluate the profitability of a given market, depending on an established firm's unknown and unobservable multidimensional type. A multiperiod multisignal model is defined to take account of strategic interaction processes between the incumbent and the potential competitor. Since significant theoretical and computational issues prevent us from finding optimal strategies, a myopic policy is discussed that leads to a reasonable outcome. An application example of the proposed solution procedure is also presented.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
