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Dynamics in research joint ventures and R&D collaborations

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  • Samano, Mario
  • Santugini, Marc
  • Zaccour, Georges

Abstract

We investigate the short- and long-term effects of different types of R&D collaborations on firms, consumers, and the industry. To that end, we consider a differentiated-product market in which firms compete à la Bertrand and invest in process innovation in order to lower the production cost over time. Investments are stochastic and there can be cartelization or competition strategies among firms at the moment of making the decision on the amount to invest in R&D. Our results show that in equilibrium, the long-run welfare is larger under a research joint venture than under other environments. Discounted present value profits increase with the level of the spillover but there are asymmetries that depend on the firms’ asymmetry on marginal costs.

Suggested Citation

  • Samano, Mario & Santugini, Marc & Zaccour, Georges, 2017. "Dynamics in research joint ventures and R&D collaborations," Journal of Economic Dynamics and Control, Elsevier, vol. 77(C), pages 70-92.
  • Handle: RePEc:eee:dyncon:v:77:y:2017:i:c:p:70-92
    DOI: 10.1016/j.jedc.2017.01.018
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    References listed on IDEAS

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    Cited by:

    1. Mario Samano & Marc Santugini, 2017. "Long-Run Market Configurations in a Dynamic Quality-Ladder Model with Externalities," CIRANO Working Papers 2017s-24, CIRANO.

    More about this item

    Keywords

    Industry dynamics; Process innovation; R&D; Research joint ventures;

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures

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