IDEAS home Printed from
   My bibliography  Save this article

Industry profit maximizing R and D networks


  • Lorenzo Zirulia

    () (CESPRI, Bocconi University)


In this paper, we extend the model of R and D network formation by Goyal and Moraga-Gonzàlez (2001) by allowing for imperfect spillovers among linked firms. We show that the complete network maximizes industry profit if spillovers for linked firms are below a threshold level. Furthermore, this threshold level turns out to be high in absolute terms in concentrated markets: when the number of firms is low, small departures from the case of perfect spillover imply that firms' private incentives to form links cannot be excessive with respect to their collective interest. This implies that the Goyal and Moraga-Gonzalez argument, for which excessive private incentives could explain the empirical stylized fact of R and D alliances instability, is no longer valid in these cases.

Suggested Citation

  • Lorenzo Zirulia, 2006. "Industry profit maximizing R and D networks," Economics Bulletin, AccessEcon, vol. 12(1), pages 1-6.
  • Handle: RePEc:ebl:ecbull:eb-05l10039

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Huasheng Song & Vincent Vannetelbosch, 2007. "International R&D Collaboration Networks," Manchester School, University of Manchester, vol. 75(6), pages 742-766, December.
    Full references (including those not matched with items on IDEAS)

    More about this item


    R&D networks;

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-05l10039. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (John P. Conley). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.