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Technology-Traditing Coalitions in Supergames

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Author Info
Curtis Eaton
Mukesh Eswaran

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Abstract

We attempt to explain the observation that rival firms often share their technologies. We show that the trading of technical information over the long haul can be sustained as an equilibrium in supergames. The strategy of ejection of a cheating firm from a technology-trading coalition, followed by the continuation of technology trading by the noncheating members, better facilitates trading than does a strategy in which cheating results in the dissolution of the coalition. Technology trading is often welfare improving, and firms may form small coalitions.

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Publisher Info
Article provided by The RAND Corporation in its journal RAND Journal of Economics.

Volume (Year): 28 (1997)
Issue (Month): 1 (Spring)
Pages: 135-149
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Handle: RePEc:rje:randje:v:28:y:1997:i:spring:p:135-149

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  1. Charbel Macdissi & Syoum Negassi, 2002. "International R&D Spillovers: An Empirical Study," Economics of Innovation and New Technology, Taylor and Francis Journals, vol. 11(2), pages 77-91, January. [Downloadable!] (restricted)
  2. Belderbos, Rene & Carree, Martin A & Diederen, Bert & Lokshin, Boris & Veugelers, Reinhilde, 2003. "Heterogeneity in R&D Cooperation Strategies," CEPR Discussion Papers 4021, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  3. Gamal Atallah, 2000. "Information Sharing and the Stability of Cooperation in Research Joint Ventures," CIRANO Working Papers 2000s-53, CIRANO. [Downloadable!]
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  4. Gamal Atallah, 2000. "Vertical R&D Spillovers, Cooperation, Market Structure, and Innovation," CIRANO Working Papers 2000s-54, CIRANO. [Downloadable!]
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  5. Cowan,Robin & Jonard,Nicolas & Özman,Müge, 2003. "Knowledge Dynamics in a Network Industry," Research Memoranda 003, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
  6. Neslihan Aydogan & Thomas P. Lyon, 2004. "Spatial Proximity and Complementarities in the Trading of Tacit Knowledge," Microeconomics 0404004, EconWPA. [Downloadable!]
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