Fits and Misfits: Technological Matching and R&D Networks
AbstractThis paper presents an economic model of R&D network formation through the creation of strategic alliances. Firms are randomly endowed with knowledge elements. They base their alliance decisions purely on the technological fit of potential partners, ignoring social capital considerations and indirect benefits on the network. This is sufficient to generate equilibrium networks with the small world properties of observed alliance networks, namely short pairwise distances and local clustering. The equilibrium networks are more clustered than "comparable" random graphs, while they have similar characteristic path length. Two extreme regimes of competition are examined, to show that while the competition has a quantitative effect on the equilibrium networks (density is lower with competition), the small world features of the equilibrium networks are preserved.
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Bibliographic InfoPaper provided by United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology in its series UNU-MERIT Working Paper Series with number 042.
Date of creation: 2009
Date of revision:
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Web page: http://www.merit.unu.edu
network formation; small worlds; R&D networks; strategic alliances; business clusters;
Other versions of this item:
- Cowan, Robin & Jonard, Nicolas & Sanditov, Bulat, 2009. "Fits and Misfits: Technological Matching and R&D Networks," MERIT Working Papers 042, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
- Nicolas Jonard & R. Cowan & B. Sanditov, 2009. "Fits and Misfits : Technological Matching and R & D Networks," CREA Discussion Paper Series 09-12, Center for Research in Economic Analysis, University of Luxembourg.
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-10-31 (All new papers)
- NEP-CSE-2009-10-31 (Economics of Strategic Management)
- NEP-INO-2009-10-31 (Innovation)
- NEP-NET-2009-10-31 (Network Economics)
- NEP-PPM-2009-10-31 (Project, Program & Portfolio Management)
- NEP-SBM-2009-10-31 (Small Business Management)
- NEP-SOC-2009-10-31 (Social Norms & Social Capital)
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