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Research joint ventures and optimal R&D policy with asymmetric information

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  • Cassiman, Bruno

Abstract

When to allow Research Joint Ventures (RJVs) or not is an important instrument in the development of an optimal R&D policy. The regulator, however, is unlikely to know all the relevant information to regulate R&D optimally. The extent to which there exist appropriability problems between the firms is one such variable that is private information to the firms in the industry. In a duopoly setting we analyze the characteristics of a second-best R&D policy where the government can either allow RJVs or not and give lump-sum subsidies to the parties involved. The second-best R&D policy without subsidies will either block some welfare improving RJVs or allow some welfare reducing ones. With lump-sum subsidies, the second-best policy trades off the expected subsidy cost with allowing welfare decreasing RJVs or blocking welfare increasing ones.

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Bibliographic Info

Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 18 (2000)
Issue (Month): 2 (February)
Pages: 283-314

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Handle: RePEc:eee:indorg:v:18:y:2000:i:2:p:283-314

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Web page: http://www.elsevier.com/locate/inca/505551

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Citations

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Cited by:
  1. Christine Heumesser, 2008. "Designing of research coalitions in promoting GEOSS. A brief overview of the literature," Working Papers 402008, Institute for Sustainable Economic Development, Department of Economics and Social Sciences, University of Natural Resources and Life Sciences, Vienna.
  2. Patrick Greenlee & Bruno Cassiman, 1999. "Product market objectives and the formation of research joint ventures," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 20(3), pages 115-130.
  3. Cassiman, Bruno & Veugelers, Reinhilde, 1999. "R&D Cooperation and Spillovers: Some Empirical Evidence," CEPR Discussion Papers 2330, C.E.P.R. Discussion Papers.
  4. Aikaterini KOKKINOU, 2010. "Economic growth, innovation and collaborative research and development activities," Management & Marketing, Economic Publishing House, vol. 5(1), Spring.
  5. Joanna Poyago-Theotoky, 1999. "A Note on Endogenous Spillovers in a Non-Tournament R & D Duopoly," Review of Industrial Organization, Springer, vol. 15(3), pages 253-262, November.
  6. Peitz, Martin & Shin, Dongsoo, 2013. "Innovation and waste in supply chain management," Journal of Economic Behavior & Organization, Elsevier, vol. 86(C), pages 191-199.
  7. Yasunori Ouchida & Daisaku Goto, 2014. "Environmental Research Joint Ventures and Time-Consistent Emission Tax," Working Papers 2014.35, Fondazione Eni Enrico Mattei.

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