This paper presents a theoretical framework that allows estimation of game theoretic models
of quantity competition, including a non-trivial class of differentiated product
The simplest and yet arguably most important examples of a quantity games are entry
In entry games the choice firms make is discrete (enter/don’t enter) and as
a result I study
a su ﬃciently general class of models to allow for either continous or integer
The main theoretical results of the paper establish easily verifiable conditions
under which an
index of market output is uniquely determined within the set of Nash equilibria.
parameters may then be estimated by comparing the predicted index of market output
cross section of markets. The paper provides both a generalization and an extension
theoretical results developed by Bresnahan and Reiss (1991) and Berry (1992) which
estimation of the homogeneous products entry game. I illustrate one member of the
of models that these results allow us to estimate by developing a model of discrete
competition using count data from the supermarket industry.