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The effects of competition on defense contractor pricing behavior
Maxwell, Melinda Ann
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This study investigates the effects of competition on the pricing behavior of defense contractors. Prior research in this area has indicated a potential for significant price reductions associated with competition. Pricing data for five dual source subsystems of the AIM-9M Sidewinder missile were examined. Key findings of the study include: â ¢ The introduction of a second source led to increased price reductions by the first source; â ¢ The first source exhibited a greater price sensitivity to lot quantity changes than the second source: â ¢ The second source was immediately price competitive with the first source; and, â ¢ Each subsystem showed evidence of gaming.
- Masters Theses