Firm Entry, Exit and Industrial Dynamic Revisited: The Perspective of Dynamical System Model

An industrial endogenous model in long - term equilibrium shows that the entry and exit of enterprise is the motivity for industrial evolution. In the case of monopolistic competition structure, there should exists market power in some degree. However, the number of monopolistic firms could not be so large that ensured the stimulant by innovative rent. In the viewpoints of long - term market dynamics, dynamic system model shows the interaction coefficient, intrinsic growth rate, self-inhibition rate, competitive inhibition rate and delays have a major impact on long-term development, and the enterprises with different size and capability may coexist under certain conditions.