Question

1. How does first-mover advantage lead into a sustainable competitive advantage?

2. Where does the Austrian Trade Cycle Theory fit into first-mover advantage?

3. How does efficiency impact collusion?

Answer 1

1.

First mover advantage brings favorable policy initiatives by the government and MNE gets first hand opportunity to work and attract the target audience. It makes the MNE to create highest level of local acceptability among the communities. It brings competitive advantage to the MNE that brings sustainable, when the MNE keeps themselves ahead of the competition in terms of the better understanding of the market, close relations with the government and subsequent result of innovation and ethically driven value chain system over a period of time. It brings sustainable competitive advantage as  a first mover advantage.

3.

Efficiency makes firm to produce more with the given level of input and it impacts negatively to the collusion.  Efficiency means firms are achieving productive and allocative efficiency and these firms do not become the part of collusion. Hence, higher efficiency means lower level of collusion.

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