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- Title
TECHNOLOGY CHOICE AND MARKET STRUCTURE: STRATEGIC ASPECTS OF FLEXIBLE MANUFACTURING.
- Authors
Norman, George; Thisse, Jacques-François
- Abstract
]This paper shows that the adoption of flexible manufacturing techniques by firms leads to a tougher price regime. However, consumers may not benefit since the tougher regime deters entry. Flexible manufacturing's ability to deter entry is moderated by two factors: non-prohibitive costs of re-anchoring flexible manufacturing processes and the possibility that entrants choose to produce niche products using designated technologies rather than adopt flexible manufacturing. Market preemption that deters entry will be characterized by excessive product variety. Alternatively, flexible manufacturers may prefer to accommodate entry by small-scale, niche firms. Moreover, ownership matters in determining equilibrium product configurations.
- Subjects
FLEXIBLE manufacturing systems; MANUFACTURING processes; MARKET entry; PRODUCT differentiation; PRODUCTION management (Manufacturing); MANUFACTURED products; MANUFACTURING industries; PRODUCTION engineering; INDUSTRIAL organization (Economic theory)
- Publication
Journal of Industrial Economics, 1999, Vol 47, Issue 3, p345
- ISSN
0022-1821
- Publication type
Article
- DOI
10.1111/1467-6451.00104