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Endogenous transport price and international R&D rivalry

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  • Takauchi, Kazuhiro

Abstract

The purpose of this paper is to consider the relationship between monopoly transport prices and an industry’s technology level of research and development (R&D). Although R&D efficiency is often considered a key factor to improve the performance of firms in an industry, we demonstrate that this standard view does not always hold in a trade model involving a monopoly transporter. In a one-way duopoly case, an exporter competes with a local firm in the local market but must pay a transport charge to the monopoly transporter to carry its product. We show that higher R&D efficiency may reduce the investments of an exporter. We further investigate a case of two-way trade comprising two symmetric countries. We also show that higher R&D efficiency may reduce the producers’ profit.

Suggested Citation

  • Takauchi, Kazuhiro, 2015. "Endogenous transport price and international R&D rivalry," Economic Modelling, Elsevier, vol. 46(C), pages 36-43.
  • Handle: RePEc:eee:ecmode:v:46:y:2015:i:c:p:36-43
    DOI: 10.1016/j.econmod.2014.12.019
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    Cited by:

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    2. Kazuhiro Takauchi & Tomomichi Mizuno, 2019. "Is competition in the transport industry bad?A welfare analysis of R&D with inter-regional transportation," Discussion Papers 1910, Graduate School of Economics, Kobe University.
    3. Kazuhiro Takauchi & Tomomichi Mizuno, 2019. "Consumer-benefiting transport cost: The role of product innovation in a vertical structure," Discussion Papers 1911, Graduate School of Economics, Kobe University.
    4. Takauchi, Kazuhiro, 2015. "Strategic export policy, monopoly carrier, and product differentiation," MPRA Paper 66003, University Library of Munich, Germany.
    5. Ishikawa, Jota & Tarui, Nori, 2018. "Backfiring with backhaul problems," Journal of International Economics, Elsevier, vol. 111(C), pages 81-98.
    6. Kanehara, Daishoku & Kamei, Keita, 2019. "Transport Price, Product Differentiation and R&D in an Oligopoly," MPRA Paper 93148, University Library of Munich, Germany.
    7. Takauchi, Kazuhiro, 2015. "Transport efficiency, downstream R&D, and spillovers," MPRA Paper 68479, University Library of Munich, Germany.
    8. Takauchi, Kazuhiro & Mizuno, Tomomichi, 2019. "Solving a hold-up problem may harm all firms: Downstream R&D and transport-price contracts," International Review of Economics & Finance, Elsevier, vol. 59(C), pages 29-49.
    9. Takauchi, Kazuhiro, 2016. "Profit-reducing fixed-price contract: The role of the transport sector," MPRA Paper 71413, University Library of Munich, Germany.
    10. Takauchi, Kazuhiro & Mizuno, Tomomichi, 2020. "Endogenous transport price, R&D spillovers, and trade," MPRA Paper 102391, University Library of Munich, Germany.

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