Entry is the process by which new firms enter a market.

Exit is the process by which firms leave a market.

The decision of a firm to enter a market is affected by a number of factors, including barriers to entry, market size, profit potential, and competition.

The decision of a firm to exit a market is affected by a number of factors, including sunk costs, profitability, competition, and technological change.

Entry into a market can lead to increased competition, lower prices, and more innovation.

Entry into a market can involve barriers to entry, sunk costs, and the risk of failure.

Exit from a market can lead to reduced losses, freed-up resources, and improved efficiency.

Exit from a market can involve sunk costs, job losses, and a negative impact on reputation.

Barriers to entry into a market can include economies of scale, patents, and government regulations.

Barriers to exit from a market can include sunk costs, long-term contracts, and employee protection laws.

Entry and exit can affect the structure of a market by increasing competition, lowering prices, and promoting innovation.

Entry and exit can affect the performance of firms in a market by increasing efficiency, improving profitability, and reducing costs.

Entry and exit can affect the welfare of consumers by lowering prices, increasing variety, and improving quality.

The policy implications of entry and exit can include antitrust laws, regulation, and government subsidies.

The challenges in studying entry and exit include data availability, measurement issues, and endogeneity.