De Pinto, Marco; Goerke, Laszlo; Palermo, Alberto - 2023
, suppliers or employees can utilize their superior knowledge to extract informational rents. Rent payments reduce profits and … informational rents are large enough. In the context of a moral hazard model, we show that insufficient entry occurs if entry costs … are sufficiently high. Such costs lower the number of firms and, thereby, raise informational rents. …