Economic Theories on Investments - Dictionary of Arguments
Mause I 461/462
Investment/market access/Economic Theory: in the context of market entry opportunities, markets are called contestable if there are no barriers to new providers to the market ((s) if an investment can be made).
Problem: Problems can occur when a large specific (or irreversible) investment has to be made to enter the market. This means that an investment in the production process can only be used for this specific market and can no longer be used for other purposes in the case of a market exit (cf. Baumol et al. 1988, p. 7) (1).
E.g. This applies to a rail network which is necessary for rail traffic but can also be used exclusively for this purpose.
1. Baumol, William J., John C. Panzar, und Robert D. Willig. 1988. Contestable markets and the theory of industry structure. San Diego 1988._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Author1]Vs[Author2] or [Author]Vs[term] is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.
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