Journal article
RJVs in product innovation and cartel stability
Review of economic design, Vol.7(4), pp.465-477
02/01/2003
DOI: 10.1007/s100580300089
Abstract
We characterise the interplay between firms' decision in product development undertaken through a research joint venture (RJV), and the nature of their ensuing market behaviour. Participant firms in an RJV face a trade-off between saving the costs of product innovation by developing similar products to one another, e.g., by sharing most of the basic components of their products, and investing higher initial efforts in product innovation in order to develop more distinct products. We prove that the more the firms' products are distinct and thus less substitutable, the easier their collusion is to sustain in the marketing supergame, either in prices (Bertrand) or in quantities (Cournot). This gives rise to a non-monotone dependence of firms' product portfolio upon their intertemporal preferences.
Details
- Title: Subtitle
- RJVs in product innovation and cartel stability
- Creators
- Luca Lambertini - University of BolognaSougata Poddar - National University of SingaporeDan Sasaki - University of Exeter
- Resource Type
- Journal article
- Publication Details
- Review of economic design, Vol.7(4), pp.465-477
- DOI
- 10.1007/s100580300089
- ISSN
- 1434-4742
- eISSN
- 1434-4750
- Number of pages
- 13
- Language
- English
- Date published
- 02/01/2003
- Academic Unit
- Economics
- Record Identifier
- 9984963150402771
Metrics
1 Record Views