Abstract
Amir and Lambson (Amir, R. and V. E. Lambson (2003), Entry, Exit, and Imperfect Competition in the Long Run, Journal of Economic Theory, 110, 191–203) developed a general infinite-horizon, stochastic model of endogenous entry and exit by integer numbers of firms facing sunk costs and uncertain market conditions. Here a more tractable special case is presented to show how the model can provide a unifying framework for issues that arise in dynamic oligopolies. Examples of these issues include: (1) the relationship between sunk costs and industry concentration, (2) entry when current profits are negative, and (3) the relationship between entry and the length of the product cycle.
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