Fumagalli, Chiara; Motta, Massimo - In: Journal of Law and Economics 56 (2013) 3, pp. 595-595
We propose a simple theory of predatory pricing based on incumbency advantages, scale economies, and sequential buyers (or markets). The prey needs a critical scale to be successful. The incumbent (or predator) has an initial advantage and is ready to make losses on earlier buyers to deprive the...