Comparing the literature on hold-up and strategic entry deterrence leads to a puzzling role for sunk or specific investments in affecting investor’s incentive. In one case, non-redeployable investments decrease investor’s ex-post bargaining power. In the other they increase it. When the entry deterrence effect is acknowl- edged, the threat of hold-up against investor is largely weakened. Contrary to pre- vious literature, in this respect, asset specificity may even constitute an endogenous enforcement device for incomplete contracts. We conclude that the impact of asset specificity on investor’s post-contractual power, far from being general, depends on the nature of interactions between contractual arrangements and market structure.
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|Titolo:||Dixit versus Williamson: the ‘fundamental transformation’ reconsidered|
|Citazione:||Nicita, A., & Vatiero, M. (2012). Dixit versus Williamson: the ‘fundamental transformation’ reconsidered. EUROPEAN JOURNAL OF LAW AND ECONOMICS.|
|Appare nelle tipologie:||1.1 Articolo in rivista|