Search results for "R&D with spillovers"
showing 2 items of 2 documents
Endogenous R&D Symmetry in Linear Duopoly with One-way Spillovers
2005
A duopoly model of cost reducing R&D-Cournot market competition is extended to encompass endogenous timing of R&D investments. Under the assumption that R&D spillovers are zero under simultaneous choices of R&D and only flow from the R&D leader to the follower under sequential choices, sequential and simultaneous play at the R&D stage are compared in order to assess the role of technological externalities in stimulating or attenuating endogenous firm asymmetry. The only timing structure of the R&D stage sustainable as subgame–perfect Nash equilibrium involves simultaneous play and thus zero spillovers.
Endogenous asymmetry and cooperative R&D in linear duopoly with spillovers
2009
In a standard model of R&D followed by linear Cournot competition, firm asymmetry is sustainable as equilibrium with non cooperative R&D if and only if the productivity of research is sufficiently large relative to the benefits of imitation. Increasing spillovers distribute R&D results among asymmetric competitors, causing price, firm asymmetry, and joint profit to reduce. With zero spillovers, a symmetric joint lab dominates asymmetric R&D competition in terms of social welfare and consumer surplus, but is sometimes dominated in terms of joint profit. Raising spillovers encourage symmetric collusion but makes the latter potentially harmful to consumers. (JEL : C72; L13; O32).