Tiffany necklace,tiffany and company necklace,tiffany and co necklaces,tiffany necklace online
Barriers to entry in a market are anything which prevent new firms from emerging and succeeding in that market. Common examples include:
As may be obvious, the concept of Barriers to entry and Economy of scale are very much interrelated, both involved in the creation and continued existence of oligopolies, and is thus a primary factor in Antitrust Legislation.
When investing in a firm just starting, it is important to consider barriers to entry involved in its market. If they are high, the firm may prove to risky for the average investor. However, incumbent firm whose market has high barriers to entry is generally a stable investment, though often one with only small returns.
A sudden lowering of barriers to entry - due to, say, a change in technology - would cause the incumbent firm's stock price to lower, while the upstart firm rises. A raise - perhaps through government regulation - would produce the opposite effect.