R&D cooperation, asymmetric technological capabilities and rationale for technology parks
AbstractStarting from the premise that firms are distinct in terms of their capacity to create radical product innovations, the present paper attempts to explore how firms choose between different forms of R&D cooperation and their consequences for social welfare. It studies a duopolistic market, where firms have to choose between R&D competition, a cost sharing alliance, an information sharing alliance or an R&D cartel. The paper demonstrates that asymmetry has an impact on alliance choice and social welfare. With similar firms, the cost sharing alliance will be preferred to R&D competition or any other form of collaboration. With significant asymmetry no alliance may be formed. In terms of social welfare, any alliance is preferable to R&D competition and the R&D cartel is the best. Given this inherent contradiction between private preferences and optimal social choice, the paper provides a rationale for public investment in terms of science and technology parks to promote R&D cartels. --
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Bibliographic InfoPaper provided by Dresden University of Technology, Faculty of Business and Economics, Department of Economics in its series Dresden Discussion Paper Series in Economics with number 11/08.
Date of creation: 2008
Date of revision:
R&D competition; R&D cooperation; technology parks;
Find related papers by JEL classification:
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
- L5 - Industrial Organization - - Regulation and Industrial Policy
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