The Learning Curve and Competition
Volume: Volume 12, No. 1
Issue: Spring 1981
Pages: pp. 49-70
Authors: A. M. Spence
Title: The Learning Curve and Competition
Abstract: This article develops a model of competitive interaction and industry evolution in the presence of a learning curve. The learning curve is a function relating the unit costs of the individual firm to accumulated volume. The responses of the model to shifts in parameters are explored through calculated examples. The paper also used a two-period model to explore differences between open and closed-loop equilibria, and to assess the impact of learning spillover effects from one firm to the next.
JEL Classification
Microeconomic Theory General (0220)
Market Structure: Industrial Organization and Corporate Strategy (6110)