Journal article
Sequencing R&D Decisions in a Two-Period Duopoly with Spillovers
Economic theory, Vol.15(2), pp.297-317
03/01/2000
DOI: 10.1007/s001990050014
Abstract
We compare simultaneous versus sequential moves in R&D decisions within an asymmetric R&D/Cournot model with linear demand (for differentiated products), general R&D costs, and spillovers. Simultaneous play and sequential play (with and without a specified leader) can emerge as appropriate formulations, depending on the ratios of spillover rate over demand cross-slope, but not on R&D efficiency. When at least one ratio is above 1/2, a sequential solution mitigates competition and leads to higher profits for each firm, and to higher social welfare. When uniquely specified, the stronger firm emerges as the R&D first-mover.
Details
- Title: Subtitle
- Sequencing R&D Decisions in a Two-Period Duopoly with Spillovers
- Creators
- Madjid Amir - King Saud UniversityRabah Amir - University of Southern DenmarkJim Jin - Queen's University Belfast
- Resource Type
- Journal article
- Publication Details
- Economic theory, Vol.15(2), pp.297-317
- Publisher
- Springer-Verlag
- DOI
- 10.1007/s001990050014
- ISSN
- 0938-2259
- eISSN
- 1432-0479
- Language
- English
- Date published
- 03/01/2000
- Academic Unit
- Economics
- Record Identifier
- 9984380539002771
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