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Testing for complementarity when strategies are dichotomous

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  • Miravete, Eugenio J.
  • Pernías, José C.

Abstract

We show that it is not possible to extend Arora (1996) reduced form test for the existence of complementarity to evaluate the relationship between a couple of dichotomous strategies as it leads to an incoherent simultaneous discrete response model.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 106 (2010)
Issue (Month): 1 (January)
Pages: 28-31

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Handle: RePEc:eee:ecolet:v:106:y:2010:i:1:p:28-31

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Web page: http://www.elsevier.com/locate/ecolet

Related research

Keywords: Dichotomous strategies Complementarity Incoherent models;

References

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  1. Arora, Ashish & Gambardella, Alfonso, 1990. "Complementarity and External Linkages: The Strategies of the Large Firms in Biotechnology," Journal of Industrial Economics, Wiley Blackwell, vol. 38(4), pages 361-79, June.
  2. Eugenio J. Miravete & Jos� C. Pern�As, 2006. "INNOVATION COMPLEMENTARITY AND SCALE OF PRODUCTION -super-* ," Journal of Industrial Economics, Wiley Blackwell, vol. 54(1), pages 1-29, 03.
  3. Arora, Ashish, 1996. "Testing for complementarities in reduced-form regressions: A note," Economics Letters, Elsevier, vol. 50(1), pages 51-55, January.
  4. Eugenio Miravete, 2007. "“Competing with Menus of Tariff Options”," Working Papers 07-02, NET Institute, revised Jul 2007.
  5. Grimpe, Christoph & Hussinger, Katrin, 2008. "Formal and Informal Technology Transfer from Academia to Industry: Complementarity Effects and Innovation Performance," ZEW Discussion Papers 08-080, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  6. Elie Tamer, 2003. "Incomplete Simultaneous Discrete Response Model with Multiple Equilibria," Review of Economic Studies, Wiley Blackwell, vol. 70(1), pages 147-165, January.
  7. Heckman, James J, 1978. "Dummy Endogenous Variables in a Simultaneous Equation System," Econometrica, Econometric Society, vol. 46(4), pages 931-59, July.
  8. Milgrom, Paul & Roberts, John, 1990. "The Economics of Modern Manufacturing: Technology, Strategy, and Organization," American Economic Review, American Economic Association, vol. 80(3), pages 511-28, June.
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Cited by:
  1. Kretschmer, Tobias & Miravete, Eugenio J & Pernías, Jose C, 2011. "Competitive Pressure and the Adoption of Complementary Innovations," CEPR Discussion Papers 8289, C.E.P.R. Discussion Papers.
  2. Hottenrott, Hanna & Rexhäuser, Sascha & Veugelers, Reinhilde, 2012. "Green innovations and organizational change: Making better use of environmental technology," ZEW Discussion Papers 12-043, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. Hou, Jun & Mohnen, Pierre, 2013. "Complementarity between internal knowledge creation and external knowledge sourcing in developing countries," MERIT Working Papers 010, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  4. Kobayashi, Mimako & Melkonyan, Tigran A., 2011. "Strategic Incentives in Biosecurity Actions: Theoretical and Empirical Analyses," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(2), August.
  5. Arora, Ashish & Forman, Chris & Yoon, Ji Woong, 2010. "Complementarity and information technology adoption: Local area networks and the Internet," Information Economics and Policy, Elsevier, vol. 22(3), pages 228-242, July.

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