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Stockholm University, Faculty of Social Sciences, Stockholm Business School, Marketing.
Aalto University .
University of Virginia.
VTT Technical Research Centre.
(English)In: Strategic Management Journal, ISSN 0143-2095, E-ISSN 1097-0266Article in journal (Refereed) Epub ahead of print
Abstract [en]

Competitors’ experiences of prior interactions shape patterns of rivalry over time. However, mechanisms that in uence learning from competitive experience remain largely unexamined. We develop a computational model of dyadic rivalry to examine how time delays in competitors’ feedback in uence their learning. Time delays are inevitable because the process of executing competitive moves takes time, and the market’s responses unfold gradually. We analyze how these lags impact learning and, subsequently, rms’ competitive behavior, industry pro ts, and performance heterogeneity. In line with the extant learning literature, our ndings reveal that time delays hinder learning from experience. However, this counterintuitively increases rivals’ pro ts by reducing their investments in costly head-to-head competition. Time delays also engender performance heterogeneity by causing rivals’ paths of competitive behavior to diverge 

Keyword [en]
competitive dynamics; time delays; perfor- mance heterogeneity; behavioral strategy; reinforcement learning
National Category
Business Administration
Research subject
Business Administration
URN: urn:nbn:se:su:diva-131019DOI: DOI: 10.1002/smj.2512OAI: diva2:935082
Available from: 2016-06-10 Created: 2016-06-10 Last updated: 2016-06-10Bibliographically approved

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