Teorias

Student: Alejandro Garcia, Code: 200810072002

1. Knickerbocker defines oligopoly as a structured which is based on things such as, few sellers, products that are close substitutes, healso said that oligopoly is characterized and defined by the structure and behavior of firms as well as by the market, going a little further, knickerbocker (1973) defines oligopolisticequilibrium as a state of affairs between sellers, he said that in a situation where al rivals have the same competitive capabilities, there is little to no reason to expect that one rival willimprove its market position at the expense of others.
Graham focuses on an oligopolistic structure to explain the strategies finding locations that were used by big European and US companies,he states that in situations where there is oligopoly companies rather avoid competitions for price and turn to competition for location.

2. Advantages: US firms were among the first tobecome skilled in areas such as research and development and production with a lot of marketing skills which allowed them to have an edge over the foreign competition which could not equal theircapabilities and skills.
Disadvantages: the main obstacles they faced were less preferential treatment by governments compare to local firms and also it was hard for them to collectinformation.

3. The differences is that the first subsidiary established or investment that is conducted in a particular industry in a given country it is seen as an aggressive investment,according to (Knickerbocker, 1973) other subsidiaries that follow in the same industry and country are seen as defensive investment to counter the first.
Knickerbocker states there are moves andcounter moves in oligopolistic strategies, the first move can be seen as an aggressive move or aggressive investment and the counter move would be the defensive move or investment.

4.