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Competition among Techniques in the Presence of Increasing Returns to Scale

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Author Info
Amable, Bruno
Abstract

A model of technology diffusion and growth originally proposed by Batten (1987), taking into account the interaction of the supply of and demand for a new product, is modified so as to admit a production technology with increasing returns to scale and the possibility of a competition between two techniques. On the opposite to the case where the production technology of the new technique exhibits decreasing returns, the presence of increasing returns to scale prevent the splitting of the market between two new techniques, and the monopoly position of one technique must obtain. The winning technique may not be the most efficient in terms of its market expansion potential, the outcome of competition depends on initial conditions on production capacity and diffusion.

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Publisher Info
Article provided by Springer in its journal Journal of Evolutionary Economics.

Volume (Year): 2 (1992)
Issue (Month): 2 (August)
Pages: 147-58
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Handle: RePEc:spr:joevec:v:2:y:1992:i:2:p:147-58

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  1. Silverberg,Gerald, 1997. "Evolutionary modeling in economics : recent history and immediate prospects," Research Memoranda 008, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
  2. Riccardo Leoncini & Francesco Rentocchini & Giuseppe Vittucci Marzetti, 2008. "You Won the Battle. What about the War? A Model of Competition between Proprietary and Open Source Software," Department of Economics Working Papers 0811, Department of Economics, University of Trento, Italia. [Downloadable!]
  3. Weel,B.J.,ter, 1997. "Cybertax," Research Memoranda 013, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
    Other versions:
    • Soete,Luc & Weel,Bas,ter, 1998. "Cybertax," Research Memoranda 017, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
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