Innovation, appropriation and entrepreneurial strategy
AbstractWe analyse the strategy of an entrepreneur seeking to earn a return on a new discovery when faced by an incumbent firm and pool of potential entrants. The entrepreneur may choose to purchase the incumbent without revealing the discovery, enter the market as a competitor, or approach the incumbent with a view to some form of cooperation. Among our findings is that it is the magnitude of the discovery and its susceptibility to appropriation, rather than entry costs, that are the main determinants of whether entry will occur. Also, whilst major discoveries will always be implemented, others might be withheld. Keywords; entrepreneur, property rights, appropriability, oligopoly
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Bibliographic InfoPaper provided by Economics Division, School of Social Sciences, University of Southampton in its series Discussion Paper Series In Economics And Econometrics with number 0403.
Date of creation: 01 Feb 2004
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-10-29 (All new papers)
- NEP-BEC-2005-10-29 (Business Economics)
- NEP-COM-2005-10-29 (Industrial Competition)
- NEP-ENT-2005-10-29 (Entrepreneurship)
- NEP-INO-2005-10-29 (Innovation)
- NEP-MIC-2005-10-29 (Microeconomics)
- NEP-TID-2005-10-29 (Technology & Industrial Dynamics)
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