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Advanced Topics in Business Strategy


Headline: Barkley and Sharpe to Announce Plans at Trade Show

I.

Introduction

II.

Limit Pricing to Prevent Entry

A.

Theoretical Basis for Limit Pricing

B.

Limit Pricing May Fail to Deter Entry

C.

Linking the Pre-Entry Price to Post-Entry Profits

1.

Commitment Mechanisms

2.

Learning Curve Effects

3.

Incompl ete Inf ormati on

4.

Reputation Effects

D.

Dynamic Considerations

III.

Predatory Pricing to Lessen Competition

IV.

Raising Rivals' Costs to Lessen Competition

A.        

Strategies Involving Marginal Cost

B. 

Strategies Involving Fixed Costs

C. 

Strategies for Vertically Integrated Firms

1.

Vertical Foreclosure

2.

The Price-Cost Squeeze

V.

Price Discrimination as a Strategic Tool

VI.

Changing the Timing of Decisions or the Order of Moves

A.

First-Mover Advantages

B.

Second-Mover Advantages

VII.

Penetration Pricing to Overcome Network Effects

A.

What is a Network?

B.

Network Externalities

C.

First-Mover Advantages Due to Consumer Lock-in

D.

Using Penetration Pricing to "Change the Game"

VIII.

Answering the Headline

IX.

Summary

X.

Key Terms and Concepts

XI.

Conceptual and Computational Questions

XII.

Problems and Applications

XIII.

Case-Based Exercises

XIV.

Selected Readings









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