I propose an equilibrium concept for a class of games in which players
make irreversible costly decisions; these games have been widely used
in the recent Industrial Organization literature. The equilibrium con
cept is defined not in the space of strategies, but in the space of (o
bservable) outcomes. It is weaker than perfect Nash equilibrium, and i
t involves combining a form of ''survivor principle'' with an assumpti
on about entry. This assumption involves only a very weak rationality
requirement: if a profitable opportunity exists in the market, there i
s ''one smart agent'' who will fill it. This weak equilibrium concept
is sufficient to imply some empirically interesting regularities in th
e area of market structure.