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Endogenous specialization of heterogeneous innovative activities of firms under technological spillovers

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  • Bondarev, Anton A.

Abstract

This paper proposes a reduced form model of dynamic duopoly in the context of heterogeneous innovations framework. Two agents invest into product and process innovations simultaneously. Every newly introduced product has its own dimension of process-improving innovations and there is a continuum of possible new products. In the area of process innovations the costless imitation effect is modelled while in the area of product innovations agents are cooperating with each other. As a result the specialization of innovative activity is observed. This specialization arises from strategic interactions of agents in both fields of innovative activity and is endogenously defined from the dynamics of the model.

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File URL: http://mpra.ub.uni-muenchen.de/35424/
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File URL: http://mpra.ub.uni-muenchen.de/45265/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 35424.

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Date of creation: 15 Dec 2011
Date of revision: 15 Dec 2011
Handle: RePEc:pra:mprapa:35424

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Keywords: Innovations; Dynamics; Multiproduct; Spillovers; Distributed Control; Differential Games;

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  1. Bondarev, Anton A., 2010. "The long run Dynamics of heterogeneous Product and Process Innovations for a Multi Product Monopolist," MPRA Paper 35195, University Library of Munich, Germany, revised 26 Nov 2011.
  2. Loury, Glenn C, 1979. "Market Structure and Innovation," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 93(3), pages 395-410, August.
  3. L. Lambertini & A. Mantovani, 2004. "Process and Product Innovation: a Differential Game Approach to Product Life Cycle," Working Papers 529, Dipartimento Scienze Economiche, Universita' di Bologna.
  4. Herbert Dawid & Alfred Greiner & Benteng Zou, 2008. "Optimal Foreign Investment Dynamics in the Presence of Technological Spillovers," CREA Discussion Paper Series 08-07, Center for Research in Economic Analysis, University of Luxembourg.
  5. Dasgupta, Partha & Stiglitz, Joseph, 1980. "Industrial Structure and the Nature of Innovative Activity," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 90(358), pages 266-93, June.
  6. Nancy T. Gallini, 1992. "Patent Policy and Costly Imitation," RAND Journal of Economics, The RAND Corporation, vol. 23(1), pages 52-63, Spring.
  7. Kenneth L. Judd, 2003. "Closed-loop equilibrium in a multi-stage innovation race," Economic Theory, Springer, Springer, vol. 21(2), pages 673-695, 03.
  8. Anton Bondarev, 2010. "Product and Quality Innovations: An Optimal Control Approach," Working Papers 439, Bielefeld University, Center for Mathematical Economics.
  9. Partha Dasgupta & Joseph Stiglitz, 1980. "Industrial Structure and the Nature of Innovative Activity (Now published in Economic Journal, Vol.90 (June 1980)pp.226-293.)," STICERD - Theoretical Economics Paper Series, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE /1980/04, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
  10. Dockner,Engelbert J. & Jorgensen,Steffen & Long,Ngo Van & Sorger,Gerhard, 2000. "Differential Games in Economics and Management Science," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521637329.
  11. Reinganum, Jennifer F, 1982. "A Dynamic Game of R and D: Patent Protection and Competitive Behavior," Econometrica, Econometric Society, Econometric Society, vol. 50(3), pages 671-88, May.
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