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Process and Product Innovation in a Vertically Differentiated Monopoly

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  • L. Lambertini
  • R. Orsini

Abstract

We analyse product and process innovations in a monopoly model with vertical differentiation. The incentive towards both kinds of innovation is always larger under social planning than under monopoly. Therefore, the comparison between the two regimes` welfare performance should account for the possibility that the planner and the monopolist adopt different technologies and supply different product ranges.

Suggested Citation

  • L. Lambertini & R. Orsini, 2000. "Process and Product Innovation in a Vertically Differentiated Monopoly," Working Papers 367, Dipartimento Scienze Economiche, Universita' di Bologna.
    • Handle: RePEc:bol:bodewp:367
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    1. Sudipto Bhattacharya & Dilip Mookherjee, 1986. "Portfolio Choice in Research and Development," RAND Journal of Economics, The RAND Corporation, vol. 17(4), pages 594-605, Winter.
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    4. L. Lambertini, 1995. "The Multiproduct Monopolist Under Vertical Differentiation: an Inductive Approach," Working Papers 226, Dipartimento Scienze Economiche, Universita' di Bologna.
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