Essays on product line competition

Understanding inter-firm competition has been of great interest to business scholars and practitioners. To gain deeper insights into inter-firm rivalry, I investigate product line competition across multiple markets. I specifically focus on how competitive behavior in one market can affect firm decisions in other markets.;In "Multimarket competition and product line rivalry," I empirically investigate product line competitions in multiple substitutable customer markets. The analysis emphasizes the product line scope decision with considerations on the intensity of competition and the mutual forbearance hypothesis. Consistent with the existing empirical literature, I find that multi-market contact reduces price competition and softens the cross-price elasticity. I contribute to the existing empirical literature by extending these results to include the firm's product line decision. Specifically, I find that multi-market contact increases reactions to competitive new product introductions, thereby intensifying product competition. Thus, any overall conclusions regarding the competitive implications of multi-market contact based on an analysis of pricing decisions alone are substantively altered when product decisions are simultaneously considered. These empirical results emphasize that a more complete understanding of inter-firm rivalry comes from considering a wider set of decision variables available to firms.;In "Competition in product systems markets", I analytically investigate how firms should compete in a product systems market. Consistent with the existing analytical literature, I find conditions that support a symmetric equilibrium structure in which both competing hardware firms either integrate into software or remain independent. I contribute to this literature by further demonstrating conditions under which an asymmetric structure is the equilibrium outcome even when there is no inherent asymmetry between competing product systems. These analytical results provide a possible rationale for observed industry structures in which an integrated product system competes with an incompatible product system offered by independent hardware and software firms.