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Information sharing and the stability of cooperation in research joint ventures

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  • Gamal Atallah

    (University of Ottawa and CIRANO)

Abstract

The model studies information sharing and the stability of cooperation in cost reducing Research Joint Ventures (RJVs). In a three-stage game- theoretic framework, firms decide on participation in a RJV, information sharing along with R&D expenditures, and output. An important feature of the model is that voluntary information sharing between cooperating firms increases information leakage from the RJV to outsiders. It is found that RJVs representing a larger portion of firms in the industry are more likely to share information. It is also found that when sharing information is costless, firms generally don?t choose intermediate levels of information sharing: they share all the information or none at all. The size of the RJV is found to depend on three effects: a coordination effect, an information sharing effect, and a competition effect. Depending on the relative magnitudes of these effects, the size of the RJV may increase or decrease with spillovers. In response to an increase in leakages, RJV members reduce their R&D spending. In addition, they either increase the RJV size while maintaining information sharing unchanged (when leakages are low), or they reduce both information sharing and RJV size (when leakages are high). The effect of information sharing on the profitability of firms as well as on welfare is studied.

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File URL: http://128.118.178.162/eps/io/papers/0004/0004010.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Industrial Organization with number 0004010.

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Length: 39 pages
Date of creation: 04 Dec 2000
Date of revision: 20 Mar 2002
Handle: RePEc:wpa:wuwpio:0004010

Note: Type of Document - PDF; prepared on PC; to print on HP; pages: 39 ; figures: included
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Web page: http://128.118.178.162

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Keywords: Endogenous R&D spillovers; Information sharing; R&D cooperation; Research Joint Ventures;

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References

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Citations

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Cited by:
  1. Abiodun Egbetokun & Ivan Savin, 2014. "Absorptive capacity and innovation: when is it better to cooperate?," Journal of Evolutionary Economics, Springer, vol. 24(2), pages 399-420, April.
  2. Gamal Atallah, 2005. "Partner Selection in R&D Cooperation," Working Papers 0503E, University of Ottawa, Department of Economics.
  3. ATALLAH, Gamal, 2000. "Information Sharing and the Stability of Cooperation in Research Joint Ventures," Cahiers de recherche 2000-17, Universite de Montreal, Departement de sciences economiques.
  4. Duarte Leite & Pedro Campos & Isabel Mota, 2011. "Computational Results on Membership in R&D Cooperation Networks: To Be or Not To Be in a Research Joint Venture," FEP Working Papers 420, Universidade do Porto, Faculdade de Economia do Porto.
  5. Gamal Atallah, 2004. "The Allocation of Resources to Cooperative and Noncooperative R&D," Working Papers 0403E, University of Ottawa, Department of Economics.
  6. Craig Boardman & Barry Bozeman, 2006. "Implementing a 'bottom-up,' multi-sector research collaboration: The case of the Texas air quality study," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 15(1), pages 51-69.
  7. Gamal Atallah, 2004. "The Protection of Innovations," Working Papers 0402E, University of Ottawa, Department of Economics.
  8. Suetens, S., 2004. "Literature review: R&D cooperation in oligopoly with spillovers: An experimental economics approach," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3529827, Tilburg University.
  9. Werner Bönte & Lars Wiethaus, 2005. "Knowledge Transfer in Buyer-Supplier Relationships – When It (Not) Occurs," RWI Discussion Papers 0034, Rheinisch-Westfälisches Institut für Wirtschaftsforschung.
  10. Werner Bönte & Lars Wiethaus, 2007. "Knowledge Disclosure and Transmission in Buyer–Supplier Relationships," Review of Industrial Organization, Springer, vol. 31(4), pages 275-288, December.

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